The pound is in a stronger position this morning, as Jean-Claude Juncker, President of the European Commission, has said that a deal could be reached before the Brexit deadline. He told reporters that he has “no emotional relationship” with the backstop, adding “if objectives are met – all of them – then we don’t need the backstop.” He said his meeting with the Prime Minister was “positive” and that “we can have a deal” in the next few weeks. Boris Johnson has said that he doesn’t want to “exaggerate progress”, however some is being made. This comes ahead of talks between Brexit Secretary Stephen Barclay and the EU’s chief negotiator, Michel Barnier, which will take place later today.
Yesterday, the Bank of England announced their decision to keep policy rates unchanged. Dollar weakness boosted sterling slightly, however reaction to the BoE’s decision was fairly muted overall.
As widely expected, all nine members of the Monetary Policy Committee voted to keep rates at 0.75%. Despite this, they reaffirmed worries over implications of a no-deal Brexit, warning that this would both damage growth and impact the pound. It is thought that the BoE won’t make any rate cuts until there is a clear decision on Brexit.
After Finland’s Prime Minister said that Boris Johnson had 12 days to put forward Brexit plans, the UK has issued confidential documents to the EU, which “reflect ideas that the UK has put forward.” However, an EU diplomat has described them as a “smokescreen.” The government has also added that they will table “formal written solutions when we [they] are ready.”
The hearing on prorogation continues, and the Supreme Court said that they are hoping to publish a verdict early next week.
