“We will not trade away our sovereignty”, Michael Gove said as he stood in front of Parliament yesterday and delivered a 30-page document outlining Britain’s terms of departure from the EU. The Government earmarked the end of June to make significant inroads with the talks; if agreement on the Canadian-style trade deal is looking unlikely, then the UK will start planning for a No Deal Brexit and leave the EU under World Trade Organisation terms come December.
The UK’s stance that they will not align with the EU laws and legislation come the end of the transition period has set a negative tone for the beginning of formal talks which are due to begin on Monday. The two sides have never looked further apart in terms of their vision for the future relationship since the Brexit referendum in 2016 – the document released yesterday goes completely against the 46-page negotiation document that Europe released earlier this week.
To pile more misery on GBP; this morning, outgoing chairman of the BOE, Mark Carney, noted that the UK should be preparing for an economic downgrading following the knock-on impact of the Coronavirus outbreak on UK businesses. Sadly for sterling, this brings interest rate cuts back into sight for the next meeting in March.
Overall, the pound is taking a battering across the board and is currently -2.71% down against the euro’s highs of the week and now sits sub-1.2875 against the dollar. Over the next few months, these wild swings of volatility could become the new norm as headlines dominate.
Have a great weekend.
Author: Jack Nicholls, Relationship Manager
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