On December 10, the pound extended its losses against the U.S. dollar and euro as investors became more cautious about the risk of the U.K. and the E.U. disagreeing on a Brexit deal. Significantly, they have just three weeks until the deadline.
The British pound extended its fall in early London trading and fell by 0.6% against the dollar at $1.3318 at 0829 GMT. The pound declined by 0.7% against the euro and settled at 90.755 pence.
The United Kingdom’s transition period with the European Union is scheduled to end on December 31. Until then, it remains in the E.U. single market and customs union, which means that rules on trade, travel, and business have remained intact.
Additionally, according to GDP data, Britain’s economic rebound almost ground to a halt in October.
On Wednesday, in the afternoon trading, the U.S. dollar boosted 0.1% against a basket of currencies to 91.027. The greenback hit an April 2018 lo of 90.47 last Friday. Furthermore, the dollar reached session highs against the yen and Switzerland franc.
Moreover, the euro declined by 0.2% and touched $1.2080. However, it was still on track for an annual gain of nearly 8%, which is its largest since 2017.
On December 10, the European Central Banks gathers for its monetary policy meeting. According to Erik Bregar, head of F.X. strategy at Exchange Bank of Canada in Toronto, the market expects a rise to its Pandemic Emergency Purchase Program.
The Australian dollar and the Chinese yuan boosted against the greenback, and both of them reach two and a half year highs against the dollar.
U.S. regulators decided to approve a covid-19 vaccine
Furthermore, the COVID-19 situation is worsening in the United States, and infections hit 15 million. Therefore, regulators decided to approve a coronavirus vaccine. Significantly, the United Kingdom started vaccinating people on December 8.
The U.S. dollar fell to 6.5198 yuan in onshore trading, which is its lowest since 2018. It put the yuan up by over 10% from its May lows. The U.S. dollar increased by 0.2% in the last session and was trading at 6.5301 yuan.
The United Kingdom Prime Minister Boris Johnson started a crisis meeting over dinner in Brussels with the European Union’s chief executive on Wednesday. After warning the bloc, it must make concessions to clinch a Brexit trade deal and avoid a hard year-end breakup.
Moreover, the Australian dollar increased to its highest since June 2018. It boosted by 0.4% and settled at $0.7436 against the U.S. dollar.