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Merkel Comments Give Brief Hope

• Posted by currencies in Bank of England, Bremain, Brexit, Budget, Currency, Dollar, Economy, EUR, Fed, GBP, Inflation, No Deal, Prime Minister, Sterling, UK, Uncategorised
• August 21, 2019
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Sterling briefly jumped yesterday afternoon after German chancellor Angela Merkel said the European Union would think about practical solutions to the backstop, an agreed insurance policy for the Irish border that London wants scrapped.

Prime Minister Boris Johnson’s demand that the EU reopen the Brexit divorce deal was rebuffed by the bloc. The deal includes a protocol on the Irish border “backstop” – which Johnson wants scrapped – that then-prime minister Theresa May agreed in November.

Prime Minister Boris Johnson is set to tell German Chancellor Angela Merkel when they meet today that unless she agrees to change the Brexit deal, Britain will leave the European Union on Oct. 31 without a deal.

More than three years after the United Kingdom voted to leave the EU, it is still unclear on what terms – or indeed whether – the bloc’s second largest economy will leave the club it joined in 1973.

Johnson, a Brexiteer who won the premiership a month ago, is betting that the threat of ‘no-deal’ Brexit turmoil will convince Merkel and French President Emmanuel Macron that the EU should do a last-minute divorce deal to suit his demands.

But with just over 10 weeks left until the United Kingdom is due to leave, the EU has repeatedly said it will not renegotiate the Withdrawal Agreement struck by Johnson’s predecessor, Theresa May, and that it will stand behind member state Ireland.

United Kingdom leaving the EU without a deal means there would be no arrangements to cover everything from post-Brexit pet passports to the trade arteries that pump capital, food and car parts between the two neighbours.

Johnson wrote a four-page letter to European Council President Donald Tusk on Monday asking the EU to axe the Irish border “backstop”. EU leaders in Brussels and the other 27 member states issued a swift and unanimous rejection.