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No Brexit Agreement, but Talks Positive

Posted by Joseph Trevisani on Dec 4, 2017 5:57:50 PM

Britain and the European Union have failed to settle the terms for the separation agreement that will lead to the negotiations for trade relations between the United Kingdom from the EU. 

Prime Minister Theresa May and European Commission President Jean-Claude Junker met on Monday. In his subsequent press briefing Mr. Junker said that there were still two or three issues that needed completion but that he thought sufficient progress could be made by the EU summit on December 14th.

The EU has demanded that the separation issues, primarily relating to the amount that Britain will pay upon leaving the European Community and the status of borders, particularly the line between Northern Ireland, which is under British jurisdiction and the Republic of Ireland which will remain an EU member, be settled before the talks over the future trade relationship between the UK and the EU commence. 

Sterling and the euro have gained substantially against the dollar since the beginning of the summer as both sides tamed their rhetoric and began to negotiate in earnest. 

The euro has risen 4.6 percent since closing at 1.1337 on June 27th and the pound 5.2 percent since its 1.2814 finish that day. The united currency topped out at 1.2092 on September 8th and the sterling at 1.3656 on the 20th.

Current levels 1.1866 and 1.3474 (5:31 ET) are indicative of the general optimism that the two sides will reach an agreement that preserves their crucial trading and financial arrangements. Each is the others largest trading partner.

Monday’s news reassured markets that the relations between Britain, Northern Ireland and the Republic of Ireland will not prevent the  EU approval at this month's organization summit for the start of negotiations for the terms of the future trade relationship between the UK and the European Union.   

EU official have been quoted that there is " an 80 percent chance and rising' that a settlement will forthcoming, as reported by the UK Telegraph.

Joseph Trevisani

Chief Market Strategist

WorldWideMarkets Online Trading

Charts: WorldWideMarkets Alpha Trader

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