The Pound declined against the Euro this morning, falling back towards 1.2450, while the UK currency slumped towards a new low under 1.58 versus the U.S Dollar.

That the euro fell to a new four month low against the U.S Dollar suggests that the British pound has lost some of its safe-haven appeal.

Such trading conditions, in previous weeks, would have lent themselves to sterling gains.

The euro has advanced despite news that Spain’s borrowing costs rose at the latest bond auction, which increased concerns that the Greek debt crisis is spreading to other Euro-zone economies. As a result, the Euro declined against the Dollar and the Yen, as a flight to safety for investors ensued.

Traders will be flocking to the U.S Dollar as a safe haven from the turmoil and global stocks and commodities markets plunge. The ECB has said it will stop lending to some Greek banks and the Chairman Mario Draghi signaled the ECB won’t compromise to keep Greece in the Euro-zone.