GBP Pressured By Brexit & COVID Woes

GBP the clear underperformer in early FX trade this week as another weekend passes without firm progress on the Brexit front, with reports pointing to continued disagreement re: fishing matters. There will be a meeting of the European Parliament's UK Coordination Group at 09:45 on Monday (Brussels time) "to assess the situation and discuss the next steps." Several source pieces have suggested that the broader Brexit talks may very well go on until the end of the year.

• The COVID-19 situation in the UK is also providing a source of pressure for GBP, with a new tier 4 system put into place across London and most of the South East of England, resulting in the closure of non-essential shops and a deeper stay at home message in play, with only essential travel permitted. A recent report from the Telegraph has noted that "tier 4 restrictions could be toughened further and remain in place until close to Easter, Government sources have admitted." Outside of this, European nations have started to close their borders to travellers from the UK.
• GBP/USD last deals 85 pips softer on the day, just below the $1.3440 mark, after printing as low as $1.3399. Support is seen at the 20-day EMA. EUR/GBP last +40 or so pips, just above GBP0.9100, with resistance seen at the Dec 15 high of GBP 0.9149.