The turbulence swirling around Prime Minister Keir Starmer’s government reached new heights this week, as the sudden resignations of two of his most trusted aides sent shockwaves through both the Labour Party and financial markets. As the prime minister faces mounting calls to resign, the United Kingdom finds itself once again grappling with political instability, leaving citizens, investors, and party members alike anxious about what comes next.
According to BBC, the week began with the surprise departure of Morgan McSweeney, Starmer’s long-time chief of staff and a fixture by his side since the Labour leadership race six years ago. McSweeney’s exit was swiftly followed—less than 24 hours later—by the resignation of Tim Allan, the government’s communications chief. The double blow underscored just how precarious Starmer’s position has become, with many inside Labour’s ranks describing the mood as one of “doom, gloom and foreboding.”
To make matters worse, the timing of these departures could hardly have been more fraught. The prime minister is already under immense pressure, facing what one senior Labour figure described as “immense peril.” The sense of instability has only grown as Starmer prepares to address the Parliamentary Labour Party (PLP) on Monday evening, a critical juncture that could determine his political survival. As the BBC noted, “a prime minister who cannot command the authority of their parliamentary party, as Starmer was unable to do last week, doesn’t last long in office.” The comparison to Liz Truss—whose premiership ended abruptly under similar circumstances—is never far from people’s minds.
Adding to the drama is Starmer’s own frustration and self-recrimination. Those close to him describe a leader “boiling with anger” over what he calls “the lies” from Lord Mandelson, whom he blames for leading him astray. Starmer’s regret over appointing Mandelson as ambassador to the United States in 2024 is palpable. As one senior figure told the BBC, “He hates the idea that he’s let people down and that cuts very deep. He knows he’s made a very big mistake.”
The loss of Morgan McSweeney is particularly significant. McSweeney was more than just an adviser; he was Starmer’s political anchor, present through both the lows—such as the near-resignation after the Hartlepool by-election defeat—and the highs, including Labour’s landslide victory in the summer of 2024. Their partnership had become a defining feature of Starmer’s leadership style, with McSweeney often acting as the “lightning conductor” for internal party frustrations. Now, with McSweeney gone, some MPs fear the next lightning strike could hit Starmer himself.
Labour MPs are divided in their assessments. Some are openly bereft. “Brilliant, dynamic, nimble, motivating, he got us here,” said one of Labour’s vast intake of MPs first elected in 2024. Another, more seasoned MP, reflected, “This was looking inevitable but you are losing a lot of politics from the building and that is not necessarily a good thing.” Yet others point out that McSweeney was also present when key mistakes were made in government, suggesting that his departure may not solve deeper issues. The BBC observed that “variations of this disagreement” are likely to play out in the coming days, but the central question now is about Starmer’s own future.
Meanwhile, the sense of unrest within Labour is mirrored in the broader country. Political volatility has become the norm, with Starmer now the sixth UK prime minister in the last decade. If he were to leave office soon, the UK would have its fifth prime minister in just four years—a dizzying pace that has left many voters and observers disillusioned. As one Labour MP put it to the BBC, “Getting rid of McSweeney has bought him time. But maybe only a week. Then loads of MPs will be jittery again.”
The stakes are raised further by the looming by-election in Gorton and Denton, Greater Manchester, scheduled for around February 24, 2026, as well as upcoming devolved elections in Scotland and Wales and local elections in England. Poor results in any of these contests could prove fatal for Starmer’s leadership. As one MP told the BBC, “This is one of his last rolls of the dice.” Another added, “He’ll have to get out there and pretty quickly and like never before set out what he’s all about and what he wants to do.”
Amid the political drama, the economic fallout has been swift and pronounced. According to Bloomberg, UK government bonds and the pound came under pressure as investors grew jittery over the prospect of renewed political uncertainty. On February 9, 2026, longer-dated UK government bonds experienced notable swings, with 10-year yields rising as much as eight basis points before settling one point higher at 4.53%. The pound, too, felt the strain, falling as much as 0.7% against the euro to hit its weakest level since January 21, 2026, before paring some of its losses.
Market watchers attributed these moves directly to the political chaos at the heart of government. Fears of another leadership contest—or even a snap general election—sent tremors through the financial markets. Yet, a brief reprieve came as Starmer’s cabinet voiced their support for the prime minister, helping to stabilize both bond yields and the currency, at least temporarily. Still, as Bloomberg noted, the underlying anxiety remains: “UK government bonds and the pound came under pressure as Prime Minister Keir Starmer fended off calls to resign, rattling investors worried about another bout of political uncertainty.”
Within Labour, the leadership vacuum has left the party adrift, with no clear consensus on what should happen next. The mayor of Greater Manchester, Andy Burnham, has seen his route to Westminster blocked for now, while former Deputy Prime Minister Angela Rayner remains under scrutiny over her tax affairs. Health Secretary Wes Streeting, widely seen as a protégé of Lord Mandelson, has distanced himself from his former mentor in recent days. “There is absolutely no consensus on what comes next,” one keen observer told the BBC.
Meanwhile, Starmer’s supporters argue that he alone holds a mandate from the electorate, having secured Labour’s landslide victory in 2024. They point to his efforts to build international alliances, including with US President Donald Trump, and insist that the party’s appeal was rooted in a desire to escape the revolving door of prime ministers that plagued the final years of Conservative rule. Yet, as one figure described it to the BBC, the current situation feels like a “Mexican standoff,” with no easy way out.
As the clock ticks down to the by-election and other key political tests, the question remains: can Starmer regain control and restore confidence, or is the country headed for yet another change at the top? For now, all eyes are on the prime minister as he prepares to face his party—and the nation—at a moment of extraordinary uncertainty.
The coming days will reveal whether Starmer’s leadership can weather this storm, or if the UK is destined for yet another chapter in its ongoing saga of political upheaval.