LONDON, June 22 (Reuters) - Britain's pound and government

bond prices held lower on Monday to Prime Minister Keir Starmer

resigning, potentially paving the way for rival Andy Burnham to

take over as Britain's seventh leader in a decade.

Sterling was last down 0.27% at $1.3202, showing

little change on levels traded earlier, while holding steady

against the euro, which traded at 0.867 pounds.

Benchmark 10-year UK gilt prices were also

relatively steady, leaving yields up 1 basis point on the day at

4.85%, unchanged from where they were prior to the announcement.

British share indexes held steady after the announcement

with the blue chip FTSE 100 index a whisker lower on the day,

and mid caps down 0.5%.

Pressure had been building on Starmer, whose popularity

among voters has tumbled over his handling of the economy, for

months.

Focus is expected to turn to who Burnham picks as finance

minister to take over from Rachel Reeves, who has fought hard to

retain the trust of bondholders in her ability to keep UK

finances on track.