Sterling had a choppy day on Friday, starting off strong and then losing some ground against the dollar. It is still weak against the dollar this morning and stronger against the euro.
Following a meeting with Brexit Secretary Stephen Barclay on Friday, the EU’s chief negotiator, Michel Barnier has said that it’s not possible to agree on a withdrawal deal and sort out the backstop ‘later.’ Barclay had argued in a speech on Thursday that “the alternative to the backstop is not necessary until the end of the implementation period in December 2020.”
Despite this disagreement, rhetoric surrounding the talks was fairly positive, with Barclay declaring that the UK and the EU share a “common purpose.” Mr Barnier said that “lots of work has to be done in the next few days.”
In a less optimistic speech, Irish minister Simon Coveney said that there is still a “wide gap” between the UK and the EU in talks, and that everyone needs a “dose of reality” on the possibility of achieving a deal.
The Labour Party will choose between two strategies for Brexit at their annual conference today. The Party is to decide whether to back Remain or to take a neutral stance.
This week, the Supreme Court is expected to announce its verdict on prorogation. If found to be unlawful, this could mean the resumption of Parliament. There is very little in the way of economic data for the UK this week, so Brexit related events could influence the pound.
