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In a Reuters interview on Monday, the UK Foreign Secretary Dominic Raab dismissed China’s accusations that Britain interfered over Beijing’s imposition of new security legislation in Hong Kong.

Key quotes

“This isn’t a gross interference in domestic affairs.” 

“It’s a matter of trust and lots of countries around the world are asking this question: does China live up to its international obligations?”

This comes after China’s ambassador to London accused the Kingdon of irresponsible responses to the new security legislation in Hong Kong.

On the UK considering offering citizenship to British National Overseas (BNO) passport-holders in Hong Kong, the ambassador noted: “We hope that they will reconsider their position. With regard to what the response China is going to make, we have to wait and see what will be the specific actions of the British side.”

Market reaction

A sense of caution prevails across the markets in Asia, as growing coronavirus concerns take over and dent the optimism on the global stock.

The tussle between China and the rest of the world over several issues could also add to the sluggish sentiment.

GBP/USD is looking to extend its bounce above 1.2500 despite broad US dollar bounce and looming Brexit uncertainty.