Commerzbank: Fiscal Risks Cloud British Pound Outlook

Commerzbank analyst Thu Lan Nguyen notes that the recent optimism surrounding UK Prime Minister Burnham has quickly dissipated, causing the British pound's gains against the euro to fully reverse. According to the bank, fiscal risks continue to cloud the outlook for sterling.

The market had initially reacted positively to political developments, but concerns over the UK's fiscal sustainability have taken precedence, weighing on the currency.