Spread of Virus Mutation Keeps Euro and Pound Under Pressure

LONDON Reuters The euro and the pound were on the defensive against the dollar on Tuesday as a new coronavirus strain spread across Britain, closing key trade routes and creating a supplychain nightmare while time was running out to strike a post Brexit trade deal.

Talks between the French and British governments to reopen their border, where hundreds of trucks are stranded, and reports suggesting movement in Brexit talks have however helped to take some pressure off both currencies.

At 0802 GMT, the euro was down 0.31 at 1.2209 while the pound was losing 0.33 at 1.3422, recovering some ground after a fall as steeply as 2.5 during the previous trading session.

The British currency was also flat at 90.95 pence against the euro after sustaining heavy losses amid the transport crisis on Monday.

New hope for a Brexit deal before Dec. 30 and talks between the British Prime Minister and the French President on the supply of goods to the island have again nurtured new hope and made EURGBP briefly look below the 0.91 mark, said Commerzbank analyst Ulrich Leuchtmann.

Another positive for the pound was data showing that the countrys economic recovery from its coronavirus crash was a bit quicker than previously thought in the JulySeptember period.

The dollar index, which measures the currencys strength against a basket of currencies rose 0.16 at 90.279 after the U.S. Congress settled on a new U.S. stimulus package.

In Asia the Australian dollar fell 0.4 at 0.7554 while the…

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