Brexit Talks Suspended After a Member of EU Tested Positive for COVID 

On Thursday, Brexit negotiators suspended direct talks after a member was positive on a test for COVID-19. However, officials are still working remotely to reach a UK-EU deal which is due in 6 weeks. 

Talks could still continue and a “comprehensive” deal be agreed in time before UK’s transition on December 31, 2020 says Finland’s European affairs minister, Tytti Tuppurainen. 

“We are at a critical stage of the negotiations,” Tuppurainen told Reuters in a phone interview. “The time pressure is huge and we all realize that time is running out … I haven’t given up faith.” 

“We all have to do our outmost in order to reach the agreement. That’s the aim of the EU. We want to have a comprehensive, a balanced agreement with the UK.” 

She spoke as the chief Brexit negotiators, the EU’s Michel Barnier and the UK’s David Frost, suspended direct talks after an EU team member tested positive for COVID-19. 

“The teams will continue their work in full respect of guidelines,” Barnier said on Twitter. 

A British government spokesman also said discussions would go on remotely. 

“The talks will resume in person when it is judged safe to do,” the spokesman said. No one from the UK’s team will need to self-isolate.  

Some EU member states including the Netherlands, France, Belgium, and Spain asked the executive European Commission to ready emergency plans incase of a no-deal Brexit. 

Thierry Breton, Franca’s representative in the Commission said Britain must accept fair competition rules for companies or be shut out of the EU’s single market of 450 million consumers from 2021. 

“I understand very well that our British friends wish to be able to benefit from the internal market,” Breton said. “If the British accept these rules, they will be welcome. But if they do not accept them, there will be no deal.” 

A new EU-UK accord must be stable to give businesses investment security rather than exposing them to the risk of future renegotiation of trading terms, he said.  

Technical Outlook 

In the daily charts of GBP/USD, the pair inched up early Friday morning in Asia session. 

As what we can see in the charts, the pair is being supported at the support level at 1.31776 signaling a strong bullish momentum. 

The pair may end strong at the end of this week’s trading session. With Brexit nearing it’s due, we may expect volatility for the sterling starting next week. However, the direction of the price is still uncertain. 

If the price will continue to be supported at the support level at 1.31776, we may see the price test the resistance level at 1.34776. Inversely, if the price will break down from this support level, it may continue to thread lower and re-test the support level at 1.26885. 

The sterling’s outlook so far has been determined by the Brexit sentiment. A Brexit deal will most likely boost the sterling’s performance. On the other hand, a no-deal is a negative for the sterling and it may thread lower.  

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