The UK Chancellor Philip Hammond is speaking live to the panel on the final day of the Davis World Economic convention, looking to address the many questions raised over Theresa May’s recent Brexit plans.
The Pound has posted sharp declines at the beginning of the trading session, as the Chancellor warns that the cost of Brexit is likely to trigger higher inflation and lower wage growth. He remains optimistic that the UK’s exit will happen within the 2 year window of Article 50, on the basis that both sides dedicate resources to the task, but has acknowledged that an interim period may be necessary if progress is made but not complete in time.
On the subject of immigration, the Chancellor echoes comments from the Prime Minister in which free movement of people is no longer viable for Britain, and curbs will be put in place across the board.
Hammond has stuck to his position in that Eurozone members have as much to lose from Brexit if the UK do not achieve a realistic deal, a message also relayed by the Bank of England’s Mark Carney.
Difficult negotiations to take place
Angela Merkel, the German Chancellor and many EU officials including the President Donald Tusk have expressed their views on Theresa May’s Brexit talk, and have reiterated that ‘cherrypicking’ will not be a privilege the UK will have. For one, it would compromise the fundamental principals laid out by all 28 member states, moving the goal posts for others to expect the same.
But Theresa May insists that no deal is better than a bad deal, which could result in the UK having no access to the single market at the end of negotiations. Markets are already expressing concerns of the potential for WTO tariffs which could hurt British trade significantly.
The UK’s position makes for difficult negotiations and Pound Sterling has a difficult journey ahead.