Sterling rose against the greenback and the euro Tuesday, as Britain’s fractious trade discussions with the EU and expectations of rate reductions to counter coronavirus damage held the currency near recent 4-1/2-month lows.
British PM Boris Johnson has raised EU hackles by saying Britain will not be sure by EU guidelines or the jurisdiction of its prime court.
The first round of negotiations with the EU’s administrative unit, the European Commission, is due to last until Thursday, with half a trillion euros’ worth of yearly trade at stake.
Sterling, which has come under heavy selling stress in recent days, regained some ground.
The currency stood at 86.94 pence per euro, up almost 0.3% on that day, having skid over 1% Monday.
In opposition to the greenback, sterling was up 0.3% at $1.2791, holding above a recent 4-1/2 month low of nearly $1.2726.
The trade negotiations have been overshadowed by deepening concerns over the spread of coronavirus and uncertainty over the extent of the economic damage it could trigger.
Market expectations have grown for central banks to cut rates of interest to curb the fallout, including possibly through coordinated action. Policymakers from developed nations, along with Britain, are to hold a conference call to debate the next steps reports suggested no immediate stimulus would be offered.
Current Bank of England (BoE) Governor Mark Carney told legislators Tuesday he expected a “highly effective and timely” global response to the economic blow from coronavirus.