European session review: GBP weakens as coronavirus resurgence concerns and Brexit risks overshadow UK infrastructure spending plans

GBP fell against most major currencies in the European session on Monday as investors weighed the UK government's infrastructure spending plans, coronavirus resurgence concerns and Brexit risks.

Reuters reported that British Prime Minister (PM) Boris Johnson said he planned to double down on his plans to increase public investment and a return to austerity would be a mistake as the country tries to recover from the coronavirus hit to the economy. Johnson also told Times Radio on Monday that he wanted a "Rooseveltian" approach to the economy, a reference to former U.S. President Franklin D. Roosevelt whose "New Deal" programme helped the United States recover from the Great Depression.

Meanwhile, coronavirus resurgence concerns and risks of a no-deal Brexit capped the gains.

Last week, the UK's PM Boris Johnson set out a significant easing of the lockdown in England, announcing that pubs, restaurants and hairdressers would be able to reopen from July 4. Market participants fear that the UK, like some other major economies, can face  a spike in coronavirus cases amid further relaxing of restrictions. 

Little progress has been made in the UK-EU talks on their post-Brexit trade relations. European Commission's spokesman said today that the EU's "overall message this week but also for the coming weeks and coming months is to intensify our negotiations in order to make progress in order to get a deal". He also stressed that "Our goal is to make progress and to reach a deal." On Saturday, the UK's PM Johnson told his Polish counterpart Mateusz Morawiecki that Britain would be ready to sever ties with the EU "on Australia terms" if no deal on its future relationship with the bloc is reached.