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• Concerns about Britain’s plan to leave the euro zone sent the pound to an 11-week low against the greenback on Monday, while U.S.-China trade tensions helped boost the U.S. currency.

Comments by officials about a no-deal Brexit stoked fears Britain would crash out of the European Union without securing a trade agreement.

The pound GBP= fell as low as $1.2917 before retracing to $1.2940, down 0.50 percent on the day.

• Worries that Italy will ramp up spending and challenge European Union budget rules, and a drop in German industrial orders in June, also weighed on the euro.

The euro zone single currency EUR=EBS fell to a five-week low of $1.1527 before rising back to $1.1552, down 0.13 percent.

Technical support around $1.15 may prop up the euro in coming days.

• The dollar, meanwhile, was boosted by trade war rhetoric.

China proposed retaliatory tariffs on $60 billion worth of U.S. goods ranging from liquefied natural gas to some aircraft on Friday, as a senior Chinese diplomat cast doubt on prospects of talks with Washington to solve their bitter trade conflict.

• Some analysts see trade tensions as beneficial for the U.S. dollar as the economy is better placed to handle protectionism than emerging markets, and as tariffs may narrow the U.S. trade deficit.

“Trade tensions are very much dollar positive so I suspect that’s contributing to the dollar gains today,” said Erik Nelson, a currency strategist at Wells Fargo in New York.

• Since mid-April, the dollar index .DXY has gained 6 percent while an emerging-market local currency bond exchange traded fund (LEMB.K) has fallen more than 10percent over the same period

Against a broad basket of currencies .DXY, the dollar was last up 0.24 percent to 95.367. It is within striking distance of a more-than-one-year peak of 95.652 reached on July 19, which is also seen as having technical resistance.

• The main U.S. economic focus this week will be Friday’s consumer price inflation report for July, which is expected to show a 0.2 percent increase in core inflation in the month, according to a Reuters poll.

• After a weekend of claims by U.S. President Donald Trump that he has the upper hand in the trade war with China, Beijing responded through state media by saying the nation is ready to endure the economic fallout.

China is prepared for a “protracted war” and doesn’t fear sacrificing short-term economic interests, according to an editorial in the nationalist Global Times on Sunday evening. “Considering the unreasonable U.S. demands, a trade war is an act that aims to crush China’s economic sovereignty, trying to force China to be a U.S. economic vassal.”

• Japan’s household spending fell 1.2 percent in June from a year earlier, extending its annual declines for a fifth month, a sign the economy may lose support from domestic demand as escalating global trade tensions cloud the outlook for exports.

Brent crude futures rose 54 cents to settle at $73.75 a barrel, while U.S. West Texas Intermediate (WTI) crude futures rose 52 cents to settle at $69.01 a barrel.

Saudi Arabia pumped around 10.29 million barrels per day (bpd) of crude in July, two sources at the Organization of the Petroleum Exporting Countries said on Friday, down about 200,000 bpd from June.

Reference: Reuters, Bloomberg