DM Monitoring
BRUSSELS/LONDON: Britain is more likely to leave the European Union’s orbit on December 31 without a trade deal than with an agreement, an EU official quoted the head of the European Commission as telling the bloc’s 27 national leaders on Friday.
Britain quit the EU in January but remains an informal member until Dec. 31 – the end of a transition period during which it has remained in the EU single market and customs union. Both sides say they want to agree arrangements to cover nearly $1 trillion in annual trade, but talks are deadlocked and British Prime Minister Boris Johnson said on Thursday there was “a strong possibility” an agreement would not be clinched.
“The probability of a no deal is higher than of a deal,” the EU official, speaking on condition of anonymity, quoted European Commission President Ursula von der Leyen as saying during an EU summit in Brussels.
Johnson and von der Leyen have given negotiators until Sunday evening to break the impasse over fishing rights and allowing Britain to be punished if in the future it diverged from the bloc’s rules. “Situation is difficult. Main obstacles remain,” the EU official said of Leyen’s message. “To be seen by Sunday whether a deal is possible.”
Sterling tumbled, stocks fell and implied volatility surged as investors started to price in the risk of a chaotic finale to the five-year Brexit crisis. The pound fell 0.8% against the dollar to $1.3190 before recovering somewhat.
