GBPUSD Plunges to 1.3325 Five-Week Low as Burnham Challenge Rumors Fuel Starmer Turmoil

GBPUSD tumbled to a five-week low of 1.3325 on May 15, down 1.5-2% for the week, as rumors intensified of Andy Burnham challenging PM Keir Starmer amid Labour infighting. The selloff began May 12 with nearly 80 MPs urging Starmer's resignation, spiking 10-year gilt yields to 5.11% and 30-year to 5.78%, amplified by hot US CPI (3.1% y/y) and PPI (+0.4% m/m) bolstering the dollar. UK Q1 GDP (+0.6%) on May 14 was overshadowed by Health Minister Wes Streeting's resignation—the third cabinet exit—leaving political risk dominant over economic gains.