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GBP/USD has been extending its falls amid Brexit and coronavirus concerns. US fiscal stimulus talks and further political developments are on Wednesday, Yohay Elam, an analyst at FXStreet, informs.

Key quotes

“PM Boris Johnson’s government is pushing through legislation that would violate the Withdrawal Agreement signed with the EU last year. It changes several aspects of dealings in Northern Ireland, including sensitive customs checks. The full details are due out later on Wednesday, but markets are already moving.”

“Sterling is also suffering from rising coronavirus cases in the UK – that have prompted the government to limit gatherings to only six people. Nighttime curfews in specific places are also considered.” 

“Broader markets are worried about another coronavirus-related issue – AstraZeneca has halted its COVID-19 vaccine trial after one patient fell ill. While such pauses are normal in such experiments, the setback – even if temporary – is weighing on markets. The safe-haven dollar is on the rise. Further developments about the patient’s illness and its correlation with the immunization candidate are awaited.” 

“Democrats and Republicans remain far apart on a fiscal stimulus deal. The GOP offered a relief package worth less than $1 trillion, which the opposition described as “meager” and an ‘insult to Americans’ intelligence.’ America’s upbeat jobs report for August – showing the unemployment rate fell to 8.4% – may have lowered lawmakers’ sense of urgency.”