Client Update - 13th February 2026

Our Prime Minister is hanging on, but only just. The argument goes that although Sir Keir Starmer’s government is weak and unpopular, replacing him would likely make things worse. British politics has seen leaders cling on after losing authority, and maybe we should hope Starmer can as well – not because he can turn this around, but because the alternatives are worse.

If Starmer falls, his successor would almost certainly come from Labour’s left, pushing policies voters have repeatedly rejected. Starmer at least has some foreign policy competence, especially in balancing relations with Europe, China, and the US. A new leader might not manage this at a time of global instability. A replacement would also face immediate pressure to call an election, creating more national disruption, or else govern without a mandate.

The leading alternatives—Angela Rayner, Ed Miliband, and Andy Burnham—are portrayed as deeply flawed. Rayner is described as a “character” admired mainly within the party, not by voters. Miliband and Burnham are seen as out of touch, believing Labour is unpopular because it is not left wing enough. This is indeed ironic as Labour’s popularity has collapsed because it has governed to the left of what it promised in 2024, raising taxes, increasing regulation, and scrapping policies voters supported.

Starmer himself is criticised for weakness and inconsistency, however I am not sure his failures justify replacing him with someone more left wing. Perhaps for now, Britain must prioritise stability and choose the “least bad” prime minister available. A leadership coup might satisfy Labour factions but honestly, who is a better bet right now?

Talking of squabbling, the Bank of England’s latest policy meeting last Thursday exposed unusually public disagreements among Monetary Policy Committee (MPC) members, yet the calm market reaction showed that investors actually welcome an open debate. The Bank of England does look pretty stable after all, compared to the US Federal Reserve under siege from Trump. The Bank did hold interest rates at 3.75%, but the unexpectedly close five to four vote against a cut highlighted a split between dovish staff analysis – hoping for a cut - and more hawkish external members keen to keep rates steady. I appreciate talking about different types of birds may confuse some of my readers, so I can explain. Doves are so named as they prioritise supporting growth and employment. They tend to see inflation pressures as easing and are more comfortable lowering rates sooner. The more aggressive and therefore “hawkish” members prioritise fighting inflation. They worry that cutting rates too much and too soon could let inflation become persistent, so they prefer to hold or even raise rates.

Since November, each MPC member has published a 200 word explanation of their vote, making their differences between the doves and the hawks far more visible.

Despite the disputes, this new process demonstrated constructive transparency rather than dysfunction. The Bank showed it can debate policy openly, critically, and politely in pursuit of its monetary stability mandate—without unsettling markets or undermining confidence. Something for Trump to consider? Heaven forbid. Even so, with the MPC votes so split, you can see why it is so hard to call what happens next. Diversity and investing with a margin of safety remain key, and this is something I feel we have done especially well over the last few years in particular. I hope this gives you confidence as we move into another interesting year for geopolitics and markets. Do have a good weekend.