Theresa May To Call For "Clean And Hard Brexit" As UK Warns Of "Market Correction"
By Tyler Durden
While the track record of the Sunday Times over the past 24 hours is somewhat spotty, following a report that as his foreign trip abroad once officially president, Trump is planning a summit with Putin in Reykjavik, which in turn was promptly denied by Trump staffers who called the story “fantasy”, overnight the paper also reported that UK Prime Minister Theresa May will announce that Britain is “seeking a clean and hard Brexit” in a speech this week that will promise to create a “strong new partnership” with the European Union.
The paper further notes that in the speech, scheduled for Tuesday, the PM will “finally lay her cards on the table”, making clear that the UK is set to pull out of the single market and the European customs union in return for the ability to curb immigration, strike commercial deals with other countries, and escape the jurisdiction of the European Court of Justice, the Sunday Times said without saying how it obtained the information.
In a separate interview with German newspaper Welt am Sonntag, May’s finance chief, Philip Hammond, said Britain would be willing to abandon “mainstream economic and social thinking” if it is unable to craft a favorable post-Brexit EU deal. Hammond said he hoped the U.K. could remain in the mainstream, but was prepared for the consequences for a hard Brexit.
“If we have no access to the European market, if we are closed off, if Britain were to leave the European Union without an agreement on market access, then we could suffer from economic damage at least in the short-term. In this case, we could be forced to change our economic model and we will have to change our model to regain competitiveness. And you can be sure we will do whatever we have to do.”
To avoid fallout from the breakup and grant businesses some certainty over the outlook, May will seek a transitional phase between splitting from the EU and the beginning of a new trading relationship, the Sunday Times said, citing Brexit Secretary David Davis. “We don’t want the EU to fail, we want it to prosper politically and economically, and we need to persuade our allies that a strong new partnership with the U.K. will help the EU to do that,’’ Davis wrote in the newspaper. “If it proves necessary, we have said we will consider time for implementation of new arrangements.’’
The market is likely to have an adverse reaction to the leaked (if unconfirmed speech): as Bloomberg points out, “May’s blueprint for Brexit risks alarming investors, bankers and company executives who will fret that May is prioritizing social issues over economic growth.” A Downing Street source said that May had “gone for the full works”, although the prime minister’s staff admitted her words were likely to cause a “market correction” that could lead to a fresh fall in the pound.
Of course, that may be inaccurate, because as the recent record streak of 14-winning days in the British …read more
Source: Theresa May To Call For "Clean And Hard Brexit" As UK Warns Of "Market Correction"
