Pound Outlook: Investors 'Too Kind' to UK Fiscal Risks

Sterling is holding its ground against major European peers, with no extra fiscal risk premium being attached to the pound so far. This suggests investors may be underestimating the UK's fiscal vulnerabilities, according to the original commentary.

The currency's resilience comes despite ongoing concerns about the UK's fiscal outlook. For now, the market is giving the pound the benefit of the doubt, but risks remain if sentiment shifts.