Massive Sterling Fluctuations as no Brexit Agreement Reached. The talks between the European Union and the United Kingdom today ended without a breakthrough being made. Terms were not met when it comes to Brexit after the Prime Minister of Britain Theresa May and the President of the European Commission Jean-Claude Juncker met today in Brussels.
Juncker commented after the meeting that there were still two or three different issues that they need to come to an agreement on.
He did feel that there was a decent amount of progress made today and that he was of the belief that a full agreement would be reached by the time the EU leader’s summit takes place on the 14th of December.
It is said that the negotiations were tough from both sides which were expected and May agreed that she saw a compromise in sight in the not so distant future.
Sterling had initially soared after there was a wave of optimism which felt that the Brexit deadlock could be broken and a trade deal between the two parties could then be discussed, but this proved not to be the case. This led to a dip in sterling as the day went on.
It is said that the parties came to an agreement when it comes to not having a hard border when it comes to Ireland, which would have been a political calamity and could have led to a massive economic fallout for the Republic of Ireland as the United Kingdom is a crucial partner for trading.
The announcement of using EU rules when it comes to trade in Northern Ireland came at midday and led to a day high spike in the sterling-dollar price. This means that there will be single market rules when it comes to Northern Ireland following the completion of Brexit.
This deal still needs to be approved by the government in Ireland before it can be cemented.
There had been a standoff between Ireland and the UK with regards to the EU customs union which means that any state that is a member of the EU will now have to pay customs duties on goods and there is an upstanding degree of regulatory framework involved.
This law has saved a fortune for businesses in member states over the ears, as well as allowing goods to be transported faster.
There had been insistences from the Trade Secretary of the UK, Liam Fox back in November that both the UK and its province of Northern Ireland would not be in this customs union following Brexit at the same time as not having the existence of a hard border.
The government of Ireland wanted the North to stay in this union as they said that this was the sole way of preventing a hard border between the two neighbours, who both conduct a lot of trade with one another.
This news gave markets a reassurance that stability in a political and business sense would be restored and would no longer be severely threatened as a result of Brexit. The Irish will no doubt be happy, as they otherwise would have seen about a 20% reduction in their export to the UK if it had not been the case.