Britain's political uncertainty is brewing, and government bonds are being abandoned by institutions.

The UK financial markets are preparing for a potential change in leadership of the Labour Party, with investors significantly reducing their positions in the UK. Mizuho Securities has stated that they have lost confidence in UK government bonds due to the clear uncertainty surrounding the new leadership. Matt Amis, Chief Investment Officer at Anben Asset Management, stated that the asset management giant has also cut its risk exposure due to concerns that any successor to Sir Starmer could lead to a shift in policy. On Monday, as Scottish Labour leader Anas Sarwar called for the Prime Minister's resignation, the cost of borrowing for 10-year government bonds briefly surged to 4.6%. After cabinet members publicly expressed support for the Prime Minister, UK government bond yields fell to around 4.53%, but borrowing costs remained high for the day.