* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh
* Graphic: Trade-weighted sterling since Brexit vote http://tmsnrt.rs/2hwV9Hv
(Updates rates, news, adds quote)
By Joice Alves
LONDON, March 16 (Reuters) - Sterling edged higher against
the euro on Tuesday and erased its earlier losses against the
dollar after Europe's medicines watchdog said AstraZeneca's
COVID-19 vaccine was safe.
Sterling had earlier fallen 0.65% versus the dollar to a
one-week low of $1.3809 but by 1430 GMT it was flat at $1.3892
Against the euro, it rose 0.13% to 85.73 pence, having
earlier hit its lowest level of 86.40 pence since March 5.
Analysts attributed the morning fall to news that Germany,
Italy and France suspended AstraZeneca's COVID-19 shots
amid safety fears, dampening euphoria in Britain over its swift
vaccination push.
The European Medicines Agency (EMA) said there was no
indication that the blood clot incidents had been caused by the
vaccine, but experts were assessing that
possibility.
The World Health Organization also said there was no proven
link and people should not panic. Shares in AstraZeneca,
Britain's second biggest listed company, were up 3.8%.
"The EMA briefing in addition to the reassurances from the
WHO should limit the fallout on the pound from the news
regarding the suspension of the AstraZeneca vaccine," said Jane
Foley, head of FX Strategy at Rabobank.
Britain said it had no concerns, but analysts have been
cautious saying that if the safety fears surrounding AstraZeneca
vaccine were confirmed, it could compromise Britain's speedy
inoculation programme.
Sterling has been under pressure too from the European
Union's move on Monday to legal action against unilateral
British changes to Northern Irish trading arrangements.
However, the setback comes after sterling gained more than
5% against the dollar in the first seven weeks of the year amid
Britain's speedy vaccination programme and declining numbers of
COVID-19 cases.
Dwindling expectations that the BoE will push interest rates
below zero, and the Brexit trade deal with the EU agreed in
December, have also supported the pound, which rose above $1.42
on February 24.
(Reporting by Joice Alves; editing by Emelia Sithole-Matarise
and Ed Osmond)