Burnham sets out plan to reform triple lock to pay for social care

Susannah Streeter, chief investment strategist at Wealth Club, said: “Bond markets are staying wary despite signs the Burnham administration will take bold steps to rethink government spending priorities by axing the triple lock for the State Pension.

“There remains nervousness about the scale of the government’s ambitions, when it has so little wriggle room.

“Ten-year gilt yields dropped back very slightly, as rumours swirled about the move to scrap the mechanism to help fund the creaking social care system, but investors are also digesting the government’s willingness to remove the ban on public ownership of water companies, which could pave the way for a raft of renationalisations.

“Although the Prime Minister does appear to have pulled off the trick of not unnerving markets further, he still faces an uphill battle to keep bond investors on side, especially at a time when the energy crisis risks causing inflationary pressures to pop up across the board.”