The pound weakened to a five-month low on Friday, erasing earlier gains, as the dollar rallied across the board in volatile trading. The dollar had sunk in Asian and early London sessions, then regained all its losses and went onto post sharp gains against the safe-haven yen as stock markets recovered globally amid efforts made by governments and policymakers to address the coronavirus outbreak.

By the late afternoon, the British currency had fallen 1.6% to $1.2363 after rising above $1.26 early in the session. On a weekly basis, the pound was down more than 5%, marking its biggest weekly drop since January 2009 in the midst of the global financial crisis.

The pound has largely tracked the volatile moves in global markets this week, with twin stimulus measures from the Bank of England and the British government, including an interest rate cut and billions of pounds of support for struggling firms, offering only temporary support.

The British currency has come under pressure as investors expect it to remain vulnerable due to its exposure to major export markets including the United States and Europe, according to Jeffrey Halley, a senior market analyst at OANDA. Against the euro, the pound weakened 0.5% to 89.49 pence, an October 2019 high.