The German Chancellor said a Brexit backstop solution could be found before the Oct. 31 deadline. The pound, sensitive to the prospect of a ‘no-deal’ exit, jumped more than 0.5%.
Merkel challenged Britain to come up with alternatives to the agreed safety net provision for the UK-Irish land border. More than three years after the United Kingdom voted to quit the EU, it is still unclear on what terms.
On the other side, France’s Macron told Johnson that is too late for new Brexit deal. Johnson met Macron at the Elysee Palace a day after talks in Berlin with German Chancellor Angela Merkel. Macron left the door open to Britain seeking a solution to the Irish “backstop”. But he said any alternative must respect both the integrity of the EU single market and stability on the divided island of Ireland.
Johnson has warned Merkel and Macron that they face a potentially disorderly no-deal Brexit on Oct. 31 unless the EU does a new deal. Macron insisted Britain’s destiny lay in Johnson’s hands alone. He said the EU did not want a ‘no-deal’ scenario, but would be ready if it happened.
Many investors say a ‘no-deal’ Brexit would hurt the economies of Britain the EU and the wider world.
The pound has fallen heavily in recent weeks on fears British Prime Minister will drive Britain out of the EU without a transition deal.
Sterling, trading around $1.2160 earlier, rocketed to as high as $1.2265, before settling around $1.2217, up 0.8% on the day. Against the euro, sterling rose as high as 90.415 pence, a more than 1% rise on the day. It was also its highest since July 29.
START TRADINGForex – Brexit backstop solution can be found Merkel says
Against a basket of six other currencies, the dollar was steady at 98.324.
Against the dollar, the yen advanced by 0.3% to 106.29 yen, nearing last week’s eight-month low of 105.05 yen.
The Australian dollar weakened 0.2% to $0.6768. The Canadian dollar slipped 0.1%.
The euro fell on Thursday, heading toward a three-week low. An uptick in euro zone business growth was offset by another decline in China’s currency. Trade war fears knocked future expectations to their weakest in over six years, a survey showed. The euro slipped 0.1% to $1.1072, nearing an Aug. 1 low of $1.1027.
In commodities, oil prices rose further above $60 a barrel on Thursday. Oil prices were supported by a drop in U.S. crude inventories and OPEC-led supply cuts, although worries about the global economy weighed.
Brent crude rose 47 cents to $60.77 a barrel by 1153 GMT, while WTI crude added 54 cents to $56.22.
PLEASE NOTE The information above is not investment advice.
Sources: Reuters, Investing, CNN money