Pound LIVE: GBP Sterling SURGES against euro as Germany falls into ‘RECESSION’

Friday, February 8, 2019
By Paul Martin

THE pound has surged against the euro after market confidence grew over a Brexit deal, but the eurozone suffered a damaging blow after Germany fell into “recession”.

Fri, Feb 8, 2019

Pound Sterling was trading at 1.1434 against the euro at 1.30pm, overturning a poor start to Thursday after markets sensed a breakthrough in the Brexit impasse.

The currency had plummeted to as low as 1.1352 against the euro yesterday afternoon after the Bank of England downgraded its 2019 growth forecast to 1.2 percent – the lowest level since the financial crash 10 years ago – citing Brexit uncertainty.

But the pound has since recovered strongly after it was announced further Brexit talks between the UK and European Union will take place, raising hopes of a deal being agreed between the two sides before the March 29 deadline.

Theresa May’s spokesperson has confirmed Brexit Secretary Stephen Barclay will meet the EU’s chief Brexit negotiator Michel Barnier to discuss alternative arrangements to the Irish backstop.

The Prime Minister is in Dublin today to hold talks with Irish counterpart Leo Varadkar in an effort to resolve the dispute over the backstop.

Ahead of her meeting with the Taoiseach over dinner, Attorney General Geoffrey Cox is holding talks in the capital with his Irish counterpart, Seamus Wolfe.

Mr Cox has been leading work within Whitehall on providing either a time limit on the backstop or providing the UK an exit mechanism from it.

reland has insisted the backstop proposals can’t be time-limited if it is to provide an effective “insurance policy” against the return of a hard border between Northern Ireland and the Republic.

In addition, the prospect of Labour voting for a Brexit deal became more likely after the party softened its red lines and indicated it would work with the government to achieve the right agreement with Brussels.

This comes after the Financial Times reported a secret group in Whitehall have been working on emergency plans to kick-start the economy in the event of a no-deal Brexit.

The group has reportedly been put together by Cabinet Secretary and head of the Civil Service, Sir Mark Sedwill, along with senior figures from the Treasury, Cabinet Office, Department for Business, Energy and Industrial Strategy, and Department for International Trade.

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