Sterling rallied on Thursday afternoon as Boris Johnson and Leo Varadkar agree they can ‘see a pathway to a possible deal’. The two leaders had ‘constructive’ talks on the UK’s Brexit proposals and believe a deal ‘is in everybody’s interest’. The talks concentrated on the challenges of customs and consent. The proposals put forward by Boris Johnson include Northern Ireland leaving the EU’s custom union along with the rest of the UK in 2021, custom checks on goods between the UK and EU to be decentralised, with paperwork submitted electronically and only a very small number of physical checks and checks taking place away from the boarder itself.
With just under three weeks left until the UK is due to leave the EU, negotiations have stalled between the UK and EU with little time remaining. Thursday’s positive talks between Johnson and Varadkar indicated that a breakthrough is still possible. Although talks were positive between Johnson and Varadkar, the UK still need to convince the proposal put forward by Johnson can be agreed by the EU before the 19th October as the EU have previously stated their concerns of how no customs checkpoints at Ireland’s land border with the UK will work.
Varadkar will consult with the EU’s Brexit negotiating taskforce after talking to Boris Johnson. The U.K. Brexit Secretary Stephen Barclay will meet the EU chief negotiator Michel Barnier on Friday morning to discuss further.