U.K. politics remain the biggest and most unpredictable, immediate risk to sterling, Monex Europe analysts say in a note. Andy Burnham, the frontrunner to replace U.K. Prime Minister Keir Starmer who announced his resignation last week, pledged fiscal discipline on Monday. While the comments lifted sterling, it flatters a "fragile picture," the analysts say. Replacing Starmer doesn't resolve the U.K.'s underlying fiscal challenges while Burnham's speech offered little on policy detail, they say. "We see little reason to abandon our bias toward modest sterling downside." The euro trades flat at 0.8610 pounds after reaching a near one-week low earlier, according to LSEG. Sterling falls 0.2% to $1.3235 after hitting a one-week high of $1.3262 Monday.(renae.dyer@wsj.com)