UK: Brief Respite For PM As Parliament Enters Recess

At the end of today’s sitting, the House of Commons goes on recess until 23 February. While this may provide a brief respite for PM Sir Keir Starmer, following an ill-tempered session of PMQs on 11 Feb, the speculation surrounding his knowledge or lack thereof of his former director of communications' links with a convicted sex offender before nominating him for a position in the House of Lords is unlikely to blow over any time soon. 

• Political predictions market have noted something of a calming of the waters (at least in the short term). Data from Polymarket gives a 39% implied probability that Starmer is out of 10 Downing Street by 30 June. While this is much higher than the 22% recorded on 4 Feb, before the Mandelson-Epstein scandal broke, it is a sharp decline from the peak of 69% recorded on 9 Feb when Scottish Labour leader Anas Sarwar made his public call for the PM to step down.
• The Gorton and Denton parliamentary by-election on 26 Feb remains the key flashpoint event in the short term. The contest is largely viewed as a two-way race between the left-wing populist Greens and the right-wing populist Reform UK, with bookies putting Labour in third place. If Labour, who have held the seat and its predecessors for many years, do come in third it would put further pressure on the PM and embolden his potential leadership challengers. 

Chart 1. Predictions Market Implied Probability Sir Keir Starmer Out of Office by 30 June, %

Source: Polymarket