The GBP to USD rate dipped during the start of trading on Monday but in contrast to this the Pound to Euro rate moved higher.
There is still an element of concern around growing coronavirus cases and further restrictions, all of which reduced risk appetite pushing the Pound to US Dollar rate down. However, as stricter restrictions are looking likely, the Pound is looking as though it might face further pressure over the coming days. At the end of trading on Monday, the Pound finished the day at 1.1121 against the Euro and 1.3522 against the US Dollar according to the Foreign Exchange Market.
The Euro dropped back on Monday following the negative correlation between the single currency and the US Dollar. Along with this, pressure mounted on the currency after it became likely that coronavirus restrictions are likely to be in place until Spring, leaving investors concerned about the state of the economy.
It was a good start to the week for the US Dollar as investors took advantage of the safe-haven currency after a sell-off in equity markets following a drop in sentiment. This came as a result of an increase in coronavirus cases around the globe and political uncertainty, all of which was met with a reluctance by the Federal Reserve to agree to any additional stimulus.