tmsnrt.rs/2egbfVh* Graphic: Trade-weighted sterling since the Brexit vote tmsnrt.rs/2hwV9Hv (Reuters) – LONDON, June 29 (Reuters) – On Tuesday, sterling fell to its lowest level against the dollar in almost a week, putting the British pound on track for its worst month since September. A broad strengthening of the dollar in recent weeks, after the US Federal Reserve’s surprise hawkish move, has reintroduced volatility to currency markets, while also knocking sterling from near 3-year highs. Although CFTC data shows the market holding a net long position on the pound, the decline in the currency has produced a shakeout in speculative bets. Sterling has now traded in a range of $1.38 to $1.40 as investors remain wary of the spread of the delta strain of the coronavirus in the United Kingdom, which has led the government to postpone the last phase of the economy’s recovery. On Monday, Prime Minister Boris Johnson stated that Britain was on track to be able to relax the majority of COVID-19 limitations on July 19. Sterling was 0.14 percent weaker against the dollar at $1.3859 by 0744 GMT, following hitting a low of $1.3856 on June 21. This month, the currency was expected to lose 2.4 percent against the dollar. The pound was unchanged against the euro, trading at 85.92 pence. In a note, ING strategists wrote, “Sterling continues to demonstrate some resilience to troubling domestic developments.” “Due to the rapid spread of the Delta variant across the UK, the UK has seen the highest number of Covid-19 cases since January, but markets are likely to take solace in the fact that, thanks to a well-vaccinated population, hospitalization and death rates are not as high as they were during previous virus waves. “This gives both the UK government and the market confidence that virus-containment restrictions would not be tightened in the wake of the latest epidemic, according to ING, and that the UK economy will continue to recover without substantial setbacks. The Bank of England kept the scale of its stimulus program unchanged last week, putting the pound on the back foot. Concerns over a post-Brexit trade dispute between the United Kingdom and the European Union in the British province of Northern Ireland have also kept investors on the sidelines. On Monday, European Commission Vice-President Maros Sefcovic expressed confidence that an agreement within the European Union could be reached in the next 48 hours to avert a ban on chilled meat product exports from the United Kingdom to Northern Ireland. The current grace period, which exempts British-made sausages and other chilled foods from customs checks, is set to expire on Wednesday. Ritvik Carvalho contributed reporting, and Philippa Fletcher edited the piece. Continue reading