The pound is maintaining its lead and is trading at $1.3147 against the dollar, according to latest reports.
The dollar has been hit amid reports that the US President Donald Trump could impose fresh tariffs on Chinese goods.
Fiona Cincotta, a senior market analyst at www.cityindex.co.uk said: “As the US and Chinese negotiators are looking to set a date for a fresh round of trade talks President Trump continues to escalate the pressure on his counterparts to gain leverage ahead of potential negotiations. A new set of US tariffs is expected to come into effect Tuesday of either 10% or 25%.
“But the tactics may backfire as China is considering dropping any talks in the near future. This would make a quick solution impossible – something the markets were hoping for – and instead entrench the current tariffs which have the potential to be detrimental not only to trade between the US and China but also China’s and global economic growth. European stocks reacted with a slide this morning although the FTSE 100 held up better than the CAC and the DAX.”