The announcement follows weeks of speculation about his future, with members questioning whether he was the right person to lead them into the next general election.
David Roberts, head of fixed income at the investment manager, said markets had been concerned about the impact of a severe result for Labour.
Many have been quick to point out that the OBR’s forecasts do not factor in the latest spike in energy prices, or the market turbulence triggered by the escalating instability in the Middle East.
Five-year gilt yields rose around 0.19% on the day, prompting warnings that a near-term Bank Rate cut now looks less likely and mortgage pricing could come under pressure.
The Liberal Democrats have urged Chancellor Rachel Reeves to hold an emergency summit with banks as fears grow over rising mortgage costs following bond market turmoil.