British Pound Rises as Juncker Says Brexit Deal Still Possible

Brexit Secretary, Stephen Barclay, is holding talks in Brussels with the European Union’s chief negotiator Michel Barnier. Britain is due to leave the EU on 31 October, but a deal has yet to be hammered out.

The sterling rose by 0.2 percent at $1.2545 by 10:30 a.m. on Friday, 20 September, reaching its highest point since 15 July.

Over the course of the month it has rallied by 3.2 percent despite massive political uncertainty in Britain.

Shamil Dhar, chief economist at BNY Mellon Investment Management, told Bloomberg the pound could rise by five percent if a Brexit deal is clinched but equally could fall to parity with the dollar and the euro if Britain crashes out of the EU with no deal.

​The recent rises follow positivity from European Commission President Jean-Claude Juncker, who was reported on Thursday as saying a deal can be reached by 31 October.

But Irish Foreign Minister Simon Coveney said on Friday that although the “mood music” had improved there was “quite a wide gap” remaining between the two negotiating positions.

Mr Coveney told the BBC there were still "serious problems" over how to handle the issue of the Irish border.He said British Prime Minister Boris Johnson had not come up with any realistic alternative to the "backstop".

Mr Johnson says he is working hard to get an agreement but the EU says Britain has not produced any concrete proposals.

On Thursday, the British government said it had sent "confidential technical non-papers which reflect the ideas the UK has been putting forward".

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