* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh
* Graphic: Trade-weighted sterling since Brexit vote http://tmsnrt.rs/2hwV9Hv
By Joice Alves
LONDON, Sept 25(Reuters) - Sterling rose against both the
dollar and the euro on Friday as investors hoped Britain's new
scaled-back job support scheme will be followed by other
stimulus measures.
Finance Minister Rishi Sunak announced a new scheme to
support jobs as COVID-19 cases surged again, but warned that the
government will support only "viable" employment.
Fears that unemployment will rise when the existing furlough
scheme ends next month kept investors nervous as Sunak said it
is impossible to save every job during an economic meltdown that
is putting millions at risk of unemployment.
But analysts are taking the view that more measures to help
the coronavirus-battered British economy will ensue.
"We know this is not the end of the story," Jefferies
analysts wrote in a note to clients. "We retain our view that
the UK is relatively well placed to announce additional fiscal
measures".
Versus the dollar, sterling was up 0.3% at $1.2784 by 0823
GMT, after hitting a two-month low of $1.2676 on Wednesday
.
Against the euro, sterling was also up 0.4% at 91.24 pence.
, after hitting a one-week high of 91.13 on Thursday.
The outlook for sterling remains bleak as talk of negative
rates, the looming risk of a no-deal Brexit and new lockdown
measures weigh down the currency.
Bank of England governor Andrew Bailey did not exclude the
possibility of negative rates, saying on Thursday that the BoE
is seeking answers on the suitability of sub-zero rates.
Prime Minister Boris Johnson told Britons to work from home
where possible and ordered restaurants and bars to close early.
The new measures could last for six months, he said.
But the biggest threat to sterling remains the risk of the
European Union and Britain failing to reach a Brexit trade
agreement by the end of a transition period in December,
according to analysts.
(Reporting by Joice Alves
Editing by Mark Heinrich)