“Nevertheless, a lack of headlines could cause some weak sterling longs to be flushed out, likely making for something of a choppy week.”
Time is currently running out for the UK as the Brexit transition period deadline looms at the end of the year.
The transition period will come to an end on December 31.
If a deal is not in place between the UK and the EU, then Britain will begin trading with the bloc on World Trade Organisation terms.
The main obstacles to a deal remain fishing rights, so-called “level playing field” rules to ensure fair competition and governance arrangements for any agreement.
George Vessey, a UK Currency Strategist at Western Union Business Solutions said: “The British Pound is being weighed down by global risk aversion this morning, despite growing optimism of a UK-EU trade deal – a scenario that should help boost sterling’s value.
“GBP/USD dropped under $ 1.30 for the first time in a week and GBP/EUR appears vulnerable under the €1.10 handle.
“Deal or no deal, Brexit presents another big challenge for UK businesses as preparation ramps up ahead of the end of the transition period.
“The UK has experienced its worst recession in over 300 years this year, plagued by the negative impact of the pandemic.
He continued: “Granted, economies globally have been hit hard by the pandemic but Brexit could worsen the economic blow.
“Leaving the EU was always going to be major hurdle for international trade and a weight hanging on the pound’s value.
“Disruption to trade was always expected after Brexit, and even with a trade deal, companies were always going to face a plethora of barriers to trade with the world’s biggest trading bloc.
“For this reason, the upside risk to sterling is likely outweighed by the downside risk if a trade deal isn’t secured in time.
“Negotiations continue this week, and a deadline of mid-November has been agreed by both sides in order to give enough time to ratify a deal before year end.”
So what does that mean for travel money?
The Post Office is currently offering a reasonable pound to euro exchange rate.
The company is offering a rate of 1.0608 for amounts over £400, 1.0608 for amounts over £500 and 1.0817 for amounts over £1,000.
Britons are being urged to check travel advice before they travel during the coronavirus pandemic.