Sterling had a knee-jerk 0.2% fall early in Asia after British Prime Minister Boris Johnson ordered a one-month national lockdown in England on Saturday to fight the spreading coronavirus nL1N2HN0F7nL9N2GY01A.
The move is no shock however, and the pound should hold above key support around 1.2860, with the dollar likely to drive moves into the U.S. election.
The lockdown will hit the economy nL8N2HM0PJ, and a senior cabinet minister said it could be extended if necessary, after the PM declared just 10 days ago that it "makes no sense at all" to "turn the lights out with a full national lockdown" nL1N2HN05A.
Asia has shown that an effective track and trace system is essential in combating the coronavirus.
The UK system does not appear to be fully functional at present nS8N2GK08F.
The spread of the coronavirus across Europe nL1N2HN0F6 adds to the pressure on Brexit negotiators to find a compromise.
Despite optimistic comments, there's little sign of a breakthrough on the key issues of the EU's 'level playing field' and the UK's 'sovereignty' nL1N2HN0G5.
Charts show GBP/USD towards the base of its three-week 1.2860-1.3177 range, with 1.2860-67, the October low and 61.8% of the September-October rise, likely resilient, unless the USD bounces into the U.S. election.
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