Monday saw the Pound take a step back as the GBP to US Dollar rate dropped to 1.2817, while there was a slight weakening in the GBP to EUR rate as this dropped to 1.0894 according to the Foreign Exchange Market. The weakening pound has come after further news that the UK is going to be implementing further coronavirus restrictions after a huge surge in cases in recent weeks. This has caused investors to prepare for turbulent times as it is likely that the recovery of the UK economy is likely to be disrupted.
The Euro also struggled on Monday after coronavirus cases also caused concerns about the economy in the Eurozone. Despite this, it held strong against the Pound, although the EUR to US Dollar rate dipped sharply. The European Central Bank has also acknowledged that it is keeping an eye on the appreciation of the Euro.
A new week brought a solid start for the US Dollar as investors flocked to the safe-haven currency after the news of coronavirus cases increasing in Europe. As a result, with cases continuing to increase, it is likely that the US Dollar is going to appreciate at a rapid rate over the coming days.