By Geoffrey Smith
Investing.com -- Liz Truss is to succeed Boris Johnson as the U.K.'s new Prime Minister, after winning a run-off for the leadership of the ruling Conservative Party.
Truss, currently Foreign Secretary, defeated her rival Rishi Sunak by a margin of 81,326 to 60,399, after fighting a campaign based on a promise of tax cuts and increased spending on defense.
Concerns about how those pledges would be financed have helped drive the pound and U.K. government bond prices down sharply over the course of the last month. The pound fell below $1.15 for the first time in over two years in early trading on Monday, hurt by a fresh surge in the price of natural gas amid the ongoing economic war between Russia and Ukraine. It's now only a whisker above its lowest level since 1985.
Likewise, the 10-year U.K. government bond yield rose another 8 basis points on Monday to trade above 3% for the first time since 2014.