Probably, what the markets need the least is that the European Union (EU) and the United Kingdom are unable to reach an understanding and that, at the end of the year, they attend an exit without economic agreement between both parties. However, in the current context in which the Covid-19 occupies everything, it seems that both parties have very little energy at this point to negotiate and to continue with the tug-of-war. Hence, many analysts think that the pound will have a hard time in the short term while Boris Johnson reaffirms his idea that There will be no extension of the negotiation period (it would have to be requested at the end of June), which will lead to the transition period ending on December 31, with or without an agreement.
Brexit negotiations resume Monday with a feeling that time is running out fast mutually. EU Trade Commissioner Phil Hogan said last Thursday in the European Parliament that “we are not making much progress at the moment”, and reflected on whether UK “has concluded that there will be no agreement”. EU Brexit chief negotiator Michael Barnier believes this week’s talks are decisive for reaching a commercial agreement, and has stated that He hopes to know whether the UK intends to leave with or without an agreement.
Bank of America Merrill Lynch he believes that there will finally be no extension of the dates and that the transition period will end, as planned, on December 31. Of course, with agreement between the parties. Pantheon EconomicsFor his part, he considers that Boris, no matter how much he refuses today, will end up requesting a one-year extension from Europe, and that this will be granted. AND Swissquote Bank He warns that there will be “a divorce without an agreement” if this week does not see a clear advance in the dialogue.
The round of talks that starts today is the last scheduled before the EU summit on June 18 and 19 and, for the moment, the United Kingdom remains firm in its intention not to touch deadlines. Britain’s chief negotiator David Frost has stated that the talks are not yet at the stage “where we are really looking to see if we can move forward.” In any case, experts recognize that now “everyone has other things on their minds” and that it is very difficult to know where this whole process is going. Bloomberg explains that the impact of an exit without agreement, a priori, would be dwarfed by the pandemic. However, he warns that the effects of this will last a long time, especially on the British economy.
AND WHILE … BORIS FALLING IN THE SURVEYS
In the midst of all this, Johnson’s Conservative Party you are seeing your lead in polls narrowing more and more after managing the Covid-19 crisis that has led the country to be one of the most affected by the pandemic, and after the latest controversy related to his main political adviser, Dominic Cummings.
A YouGov poll for The Times newspaper published last week showed that the Conservatives’ lead over the main opposition party, Labor, has dropped nine percentage points in one week. Support for the ‘tories’ fell four points, to 44%, while support for Labor rose five points, to 38%, compared to the previous week.
“After a tough week dominated by the actions of the prime minister’s top adviser, conservatives have seen their 15-point lead over Labor slide to just 6 points,” notes YouGov, who surveyed 1,629 adults between 25-26. may.
Boris Johnson’s top adviser, Dominic Cummings, has been accused of breaking the confinement rules after traveling with his wife and son 400 kilometers from London. Cummings, an influential and controversial figure, has refused to apologize.