Summary
- UK Cabinet minister Robert Jenrick has indicated that hopes for a post-Brexit trade deal are rising.
- The European shares witnessed some gains on report of a trade deal, while UK broader market was marginally in red
The UK government is keen on negotiating with the European Union for a free trade agreement and simultaneously has been managing the severe Covid-19 pandemic which has severely disrupted the economy.
The Brexit deal has taken a backseat due to the spread of the coronavirus worldwide but with the year coming to an end, the time has come for the final decision. Questions such as will there be a deal or if there is a deal what type of deal is likely to be in place.
UK Cabinet minister Robert Jenrick has indicated that hopes for a post-Brexit trade deal are rising and stated that he was reasonably optimistic that a late deal will be agreed before the current trading arrangements expire.
Jenrick also said that major differences are still there between the EU and the UK regarding fishing and the level playing field measures.
The British government has already told businesses to make sure they are ready for big changes when the UK makes its final Brexit plunge on 31 December. Though talks on a free trade deal with the bloc are going on in Brussels, the negotiation is stuck. PM Boris Johnson and European Commission president Ursula von der Leyen are in close contact to resolve the remaining issues.
He added that the authorities are working through those issues, and the negotiators will keep going. Johnson has been very clear that he is going to negotiate until the very end. However, he had noted that there isn’t sufficient progress.
EU lead negotiator Michel Barnier said that the EU was making a final push to reach a deal and it was a crucial moment.
If both the parties fail to reach a deal, the UK will then have to abide by the World Trade Organisation terms, which means tariffs and quotas on trade with the EU.
Impact on the stock market
The news that a Brexit trade deal could be struck cheered the investors with the European shares witnessing a rise today. The European STOXX 600 index traded 0.9 per cent higher at 4:14 PM. However, the London Stock Exchange’s FTSE 100 fell back as the pound gained on the news and weighed on shares of internationally focused firms on the index.
