Risk aversion kicks in as UK's new mutated virus causes concerns
- UK coronavirus - Tier 4 restrictions could remain in place until Easter
- UK PM Johnson will chair an emergency meeting Monday as UK is nearly cut off from Europe
- Senior UK govmt source tells Reuters Brexit talk still difficult, significant still differences
- Chair of the EU parliament says it is not possible to ratify any Brexit trade deal prior to the end of the year
Adding to that is Brexit trade talks continuing to stall and go nowhere (surprise, surprise.. not!), with the news all posted earlier by Eamonn (⬆).
The new strain of the coronavirus, reported to be 70% more transmissible, has led to UK PM Johnson pulling back his Christmas relaxation advise and also many European countries introducing a travel ban from the UK for the time being.
That list includes Germany, France, Italy, Netherlands, Belgium, and Austria among others.
Tier 4 restrictions have also been introduced in London and southern England and that is dampening the mood further for UK economic prospects, as there is a growing fear that the virus situation will stay the course through Q1 2021 at least.
The pound has been smashed lower, dropping by over 1% against the dollar after a gap to the downside following the developments over the weekend.
Meanwhile, we are seeing some hints of risk aversion as there are some jitters that this latest mutated virus could see renewed havoc in the meantime while vaccine developments are just only starting to get up and running in the past few weeks.
Though, there is some element of year-end conditions for risk trades to consider in the latest pullback - especially for the dollar - so make what you will of the headlines.
