* The Swiss franc falls to a 7-month low against the euro
* The US closure was avoided while Trump signs the COVID-19 bill
* The pound sterling rises to almost 2 1/2 years
* Chart: World currency rates in 2020 tmsnrt.rs/2RBWI5E (London Eurozone Government Bond Report to be combined with London Forex Report this week)
AMSTERDAM, 28 Dec. (Reuters) – The Swiss franc fell to its lowest level in nearly seven months against the euro on Monday, while the Brexit trade deal remained in the spotlight as the dollar fell after US President Donald Trump signed a bill COVID-19, avoiding government closure.
The Swiss franc fell 0.3% to 1.08860 against the euro, the lowest since June 8. It was unchanged against the US dollar at 88,835 cents at 0903 GMT.
“What we are seeing is a continuation of prices outside the strong risk of Brexit,” said Ulrich Leuchtmann, head of FX research at Commerzbank in Frankfurt.
“I think many market participants saw Swissie as an alternative to the euro, (which) would have been more affected by a tough Brexit,” he said. Investors are likely to close such positions in the coming sessions, he added.
The euro rose 0.1% to $ 1.22370, close to a two-year high and two $ 1.2273 reached this month.
In the United States, Trump signed a $ 2.3 trillion pandemic aid and spending package into law, avoiding the partial shutdown of the federal government that began Tuesday.
The dollar fell 0.3% against a basket of currencies to 90,031, the lowest level in a week.
The increase in risk appetite has also affected government bonds safely, as the 10-year US Treasury increases by 2 basis points to 0.95%. Germany’s 10-year benchmark yield remained unchanged at -0.55%.
Meanwhile, the British pound added 0.1% against the US dollar to $ 1.3551, continuing to keep in sight the $ 1.3625 mark it reached earlier this month, for the first time since May 2018 .
It approached this level on Thursday, when the United Kingdom and the EU announced the trade agreement.
The pound fell 0.5% against the euro to 90,280 pence.
“Markets are likely to wait until next week, before buying again (sterling), fearing massive blockages in the English Channel as the new rules take effect,” Jeffrey Haley told customers. senior market analyst at OANDA.
While the deal was a relief for investors, the nature of the pact leaves the UK much more detached from the EU, analysts say, suggesting that any subsequent gains will be modest and the decline that led to 2016 UK assets not disappear soon.
Brussels has not yet made any decision on granting Britain access to the bloc’s financial market.
Mitsuo Imaizumi, chief FX strategist at Daiwa Securities in Tokyo, expects the pound and the euro to fall against the dollar, reaching $ 1.30 and $ 1.15, respectively, by the end of the summer.
The Australian dollar, a trade-sensitive currency, rose to 76,110 US cents to a 2 1/2-year high of 76,390 this month.
10-year bond yields in Southern Europe – considered more risky due to their lower credit ratings – fell by 2-3 basis points.
The yuan rose after China’s central bank raised its official guidance level to its highest level in 30 months, to 6.5280 against the dollar on the onshore market, but remained unchanged at 6.5408.
It last fell 0.3% on the offshore market to 6.5311.
The yen rose slightly against the dollar, rising 0.1% to 103,455.
Political factors in central Japan have been divided on how far they should go in examining the control of the yield curve, with some calling for a comprehensive review of the framework, a summary of views expressed in the December rate review showed on Monday.
Reporting by Yoruk Bahceli; additional reporting by Kevin Buckland in Tokyo; Edited by Andrew Heavens