The release of more Epstein files last week has left U.K. Prime Minister Keir Starmer fighting for his political life and possibly inject volatility into British pound pairs.
The controversy centres on Peter Mandelson and his relationship with Epstein. Starmer appointed Mandelson to U.K. ambassador to the US despite knowing his relationship with the convicted pedophile.
The pressure on Starmer intensified when two senior aides resigned in quick succession: his chief of staff, Morgan McSweeney, followed by communications director Tim Allan.
Starmer remains Prime Minister, but questions remain as to how much longer.
The 1.3500 to 1.3450 zone is the key area to watch on the downside for GBPUSD. A daily close below this zone could weaken the bullish structure. EURGBP provides important confirmation. The cross remains capped below the 0.8750 to 0.8800 resistance area. As long as EURGBP stays contained below this zone, sterling weakness might appear limited.
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