---
title: "With Keir Starmer premiership on the brink, British government debt tumbles further"
type: "News"
locale: "en"
url: "https://longbridge.com/en/news/286054849.md"
description: "British government debt has sharply declined amid speculation that Prime Minister Keir Starmer may face a leadership challenge or resign. The yield on the 10-year U.K. government bond rose to 5.09%, while the 30-year gilt yield increased to 5.77%. The British pound fell 0.5% to $1.3537, and the FTSE 100 index dropped 0.9%. Starmer is under pressure following local election losses, with 73 Labour MPs calling for his resignation, raising concerns about potential aggressive spending policies from a new prime minister."
datetime: "2026-05-12T07:38:54.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/286054849.md)
  - [en](https://longbridge.com/en/news/286054849.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/286054849.md)
---

# With Keir Starmer premiership on the brink, British government debt tumbles further

By Steve Goldstein

Members of the media stand outside Number 10 Downing Street (R), the home of Britain's Prime Minister Keir Starmer, ahead of a cabinet meeting in central London on May 12, 2026.

British government debt fell sharply on Tuesday, with reports suggesting Prime Minister Keir Starmer may face a leadership challenge or even resign as early as today.

The yield on the 10-year U.K. government bond BX:TMBMKGB-10Y, called a gilt, rose 8 basis points to 5.09%, having risen 9 basis points on Monday. Yields move in the opposite direction to prices.

The yield on the 30-year gilt BX:TMBMKGB-30Y rose 10 basis points to 5.77%, having gained 9 basis points on Monday.

The British pound (GBPUSD) fell 0.5% to $1.3537. The U.K. FTSE 100 UK:UKX stock-market index fell 0.9% in early trade, though other major European equity markets also lost ground.

Starmer is under political pressure after the Labour Party he leads suffered a heavy defeat in local elections last week, losing votes both to the Reform Party on the right and the Green Party on the left. Investors fear that any new prime minister would bring in more aggressive spending policies.

Sky News reported the tally of Labour MPs calling for Starmer's resignation is now at 73.

"None of this is good in the overall picture, with U.K. bonds, which were already trading at their highest yield since 1998 before the local elections, see their yields climb even higher. This owes to concerns that whoever the party chooses to replace the PM will be fiscally to the left, endangering the credibility the PM and his Chancellor had built up over the past two years," said David Stritch, a currency analyst at Caxton.

\-Steve Goldstein

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

05-12-26 0338ET

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