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Brexit Deal Possibilities Surge, Sending Pound Higher

By Ibeth Rivero

Ibeth contributes daily market commentary in both English and Spanish (both of which she speaks fluently) and she also manages the DailyForex mobile app to ensure that traders around the world are getting important market updates in real time.

Brexit deal

The European Union chief negotiator, Michael Barnier said that a Brexit deal is still possible, despite it now being more difficult to reach it. He added that it's time to turn good intentions into actions.

"Reaching an agreement is still possible but obviously any agreement must work for everyone - for all of the UK and the whole of the EU," said Barnier, "It is high time to turn good intentions into a legal text," he added.

With only a couple of weeks before we reach the Brexit deadline, the global tensions related to the Brexit have been escalating, as the United Kingdom simply hasn't been successful in convincing Brussels of approving their alternatives to the Irish Backstop clause (as they're asking for more concessions), which is currently blocking the path towards a negotiated exit from the European Union. This inability to reach a deal that would satisfy the British Parliament and the European Leadership at Brussels is what is behind the current deadlock.

The European Union leadership is set to hold an emergency summit in order to discuss a Brexit deal, while Johnson called for getting Brexit done on Yesterday, blistering any hopes of seeing the British Government asking for an extension.

"Let's get Brexit done, so we can take back control of our money, our borders, and our laws," said Johnson, "Let's get Brexit done so we can regulate differently and better," he added.

Johnson's proposal consists of leaving Northern Ireland on the Customs Union with the UK, but the UK would impose the EU customs standards and rules, avoiding the customs checks in the border between Northern Ireland and the Republic of Ireland. This would be helpul since the main fear of the European Union is the creation of a hard border between them, as it would go against the Good Friday Agreement (also known as the Belfast Agreement), however, it seems that the Union considers this proposal too fuzzy.

In any case, the EU seems to be willing to grant a Brexit extension, given that is still not clear if a Brexit deal is going to be reached in the upcoming weeks.

“It’s up to the Brits to decide if they will ask for an extension,” said the European Commission President Jean Claude Juncker, “But if Boris Johnson were to ask for extra time – which probably he won’t – I would consider it unhistoric to refuse such a request,” he added.

Right after Barnier's comments, the Pound Sterling added gains against the US dollar, by 9:42 GMT the GBP/USD pair went up 0.21 percent, hitting the 1.2633. Conversely, it gained against the Canadian Dollar and the Japanese Yen, increasing 0.16 percent and 0.04 percent respectively. The Euro went down 0.35 percent against the Sterling, at 0.8715.

Ibeth Rivero
About Ibeth Rivero

Ibeth contributes daily market commentary in both English and Spanish (both of which she speaks fluently) and she also manages the DailyForex mobile app to ensure that traders around the world are getting important market updates in real time.

 

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