Pound Jumps on Rumors About Brexit Deal

The Great Britain pound jumped, erasing previous losses, today after the unconfirmed report that Britain may be offered by the European Union a two-year transition deal that will make it easier for the country to depart from the EU.

The final date for Britain’s exit from the Union is March 2019. Yet according to German newspaper Handelsblatt, EU’s chief Brexit negotiator Michel Barnier said that he is ready to offer the United Kingdom a smoother two-year transition period if the UK fulfills its financial obligations to the EU and will sign a divorce papers. That means Britain will have access to the single market, the customs union, and the open borders till 2021. The only difference will be that the UK will not have voting rights it has now as a full member.

It is important to remember, though, that the news has not yet been officially confirmed by EU or Britain’s authorities. In fact, the news contradict the previous report about Barnier saying that the Brexit negotiations has reached a deadlock.

GBP/USD GMT traded at 1.3261 as of 19:50 GMT today after opening at 1.3222 and falling to the daily low of 1.3121. GBP/JPY opened at 148.71, fell to the day’s low of 147.27, but rebounded to 148.80 later. EUR/GBP fell from the opening of 0.8966 to 0.8923 after touching the session high of 0.9032.

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