New coronavirus pressure hits pound, euro as traders search {dollars} By Reuters

By Julien Ponthus

LONDON (Reuters) – The British pound and the euro fell on Monday as traders sought refuge within the greenback, after a fast-spreading new coronavirus pressure shut down a lot of the United Kingdom and disrupted worldwide freight amid Brexit talks uncertainties.

Sterling fell near 2% in opposition to the greenback in morning buying and selling earlier than Prime Minister Boris Johnson chairs an emergency response assembly to debate worldwide journey and the movement of freight out and in of Britain.

Much of Europe has lower off transport with the UK sowing chaos for households and firms simply days earlier than Britain exits the European Union.

“The British horror stories of a shortage of goods after a hard Brexit are taking on a whole new drive – for a completely different reason,” mentioned Commerzbank (DE:) strategist Ulrich Leuchtmann.

Adding to the transport disaster attributable to the virus had been fears the UK will crash out of the EU and not using a commerce deal on Jan. 1.

Britain insisted on Sunday that the EU ought to shift place to open the best way to a post-Brexit commerce deal, however there was to date no signal a breakthrough.

At 0756 GMT, the pound was down 1.85% at $1.3277.

The euro additionally sustained losses in opposition to the greenback, down 0.74% at $1.2169, however rose 1.26% at 0.9170 pence in opposition to the pound.

The pandemic stress in Europe overshadowed a weekend deal amongst U.S. congressional leaders for a $900 billion coronavirus support package deal.

The greenback climbed in opposition to main friends on Monday with traders searching for its relative security as many international locations tightened COVID-19 lockdowns.

The greenback’s rebound comes after it sank to two-and-a-half-year lows final week, pushed by optimism that vaccines would assist revive international development.

The gained 0.38% to 90.625, after touching 89.723 on Thursday for the primary time since April 2018.

The riskier Antipodean currencies weakened in the beginning of the holiday-shortened buying and selling week as traders rushed for haven belongings.

The greenback dropped 1.24% to 75.295 U.S. cents.

The U.S. greenback gained 0.32% to 103.62 yen, one other protected haven.