It is going to be one of those days. As Boris Johnson heads to Brussels for a crucial 2-day summit, the DUP have made his trip much trickier.
The Northern Ireland party issued a statement this morning stating they ‘cannot support what is being suggested on customs and consent issues’ and that there is ‘a lack of clarity on VAT’. That means either Johnson needs to compromise further, the EU needs to accept the DUP’s demands, or the DUP themselves need to back down. The party did end its statement claiming it will ‘continue to work with the Government to try and get a sensible deal that works for Northern Ireland’, so progress is still possible. It just might need an extension to allow a deal to blossom.
Firmly strapped onto the Brexit roller coaster, the pound tumbled following the DUP’s comments, shedding 0.4% against dollar and euro alike. That fall keeps the gains from this week intact, but takes it from yesterday’s fresh 5-month highs. Not that sterling will necessarily remain in the red; it opened in much the same way on Wednesday, only to end the session up thanks to the positive – but clearly not positive enough – Brexit chatter.
Like with Tuesday’s jobs data and Wednesday’s inflation figures, it is hard to see the latest UK retail sales reading meaning much to the pound. Nevertheless, it is expected to rise from -0.2% to -0.1% month-on-month.
Despite the pound being in an emotionally unstable place, the FTSE was unable to capitalise on the currency’s losses, instead starting Thursday flat at 7170. This as the Eurozone indices saw a muted open, with the DAX and CAC slipping 0.1% and 0.3% respectively.
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