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Sterling (GBP) Remains Under Pressure as EU/UK Trade Talks Stall

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Sterling (GBP) Remains Under Pressure as EU/UK Trade Talks Stall
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              <h2 class="fe_heading2">Sterling (GBP) Remains Under Pressure as EU/UK Trade Talks Stall</h2>
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Sep 05, 2020 (MENAFN via COMTEX) —

(MENAFN – DailyFX) Sterling (GBP) Charts and Analysis:

  • Chances of a no-deal outcome are increasing.
  • BoE commentary leaves further monetary stimulus on the table.

Starts in: Live now: Sep 07 ( 10:09 GMT ) Recommended by Nick Cawley Key UK Events and Markets for the Week Ahead Register for webinar Join now Webinar has ended

The British Pound is becoming increasingly vulnerable to a hard Brexit outcome with little to no visible progress on future EU/UK trade made between the two sides. After the latest informal talks between the two sides, EU chief negotiator Michel Barnier accused the UK of lacking any real willingness to move forward, leaving the EU deadline of October 31 in doubt. The UK for its part refuses to countenance any deal on fisheries and level playing field commitments saying that it is not compatible with the UK’s status as an independent country. The odds of a hard/no-deal Brexit have risen to between 30% and 50% according to various market sources reports and commentary and this leaves Sterling vulnerable over the next 7 weeks. The next round of talks start on September 7th.



Recommended by Nick Cawley Building Confidence in Trading Get My Guide

In a recent speech titled ‘The economy and COVID-19: looking Back and Looking Forward’, Bank of England external member of the MPC Michael Saunders noted that unemployment is ‘likely to rise significantly in coming quarters’ and that if the economic recovery stalls, ‘some further monetary loosening may be needed’. While the BoE have consistently said that all monetary policy options are live, including negative rates, further QE is likely with the MPC meeting and monetary policy report publication on November 5 the most likely date. The UK gilt market continues to suggest lower for longer interest rates with the gilt curve negative-yielding all the way out to 6-years.

Next week there is little in the way of UK economic data until Friday 11th when the monthly GDP-3 month average for July is released at 07:00 GMT. This is expected to show a sharp pick-up in UK growth to -7.5% from a prior -20.5% with the year-on-year number falling to -11.2% from -16.8%. Manufacturing and industrial production data for July will also be released.

For all economic data and events, see the DailyFX Calendar.

GBP/USD touched a multi-month high of 1.3477 at the start of the week before fading lower to a current level of 1.3200, due in part to a resurgent US dollar . The chart shows that cable has been moving higher in a bullish flag formation, but this is now under threat a cluster of old lows around 1.3050 the next area of support.

GBP/USD Daily Price Chart (January – September 4, 2020) GBP/USD MIXED Data provided by of clients are net long. of clients are net short.

Change in Longs Shorts OI
Daily -18% -12% -14%
Weekly 16% -20% -10%

Learn How to Use Sentiment in Your Trading Strategy Get My Guide

IG client sentiment data shows retail traders are net-short GBP/ USD , normally a bullish contrarian signal for the pair. However, traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current GBP/USD price trend may soon reverse lower despite the fact traders remain net-short.

Traders of all levels and abilities will find something to help them make more informed decisions in the new and improved DailyFX Trading Education Centre

What is your view on Sterling – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author via Twitter @nickcawley1 .

DailyFX

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EU’s Michel says relocation no silver bullet to migration feuds

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EU’s Michel says relocation no silver bullet to migration feuds

Europe must improve migration procedures on its external borders, seal more deals with foreign countries and synchronise asylum policies in the bloc before it tackles the thorny issue of hosting asylum seekers, a top EU official said on Friday.

European Council President Charles Michel, who chairs summits of EU leaders, spoke to Reuters and five other European news agencies as the bloc prepares to have a fresh go at reforming its troubled asylum laws.

The system all but collapsed amidst a surge in arrivals of those fleeing war and poverty in the Middle East and Africa with more than a million people reaching the EU in 2015. This fuelled support for eurosceptic and nationalist groups, as well as contributing to Brexit.

“It’s not easy, it’s a difficult question and a difficult topic,” Michel said. “Let’s start with some initiatives which will help us be more efficient and maybe decrease political sensitivity of some other topics.”

By the latter, he meant deep rifts among the 27 EU countries over how to care for refugees and migrants.

Under the EU’s now-defunct rules, the southern states of arrival like Italy, Malta or Greece are responsible but they were quickly overwhelmed at the height of the sea arrivals season.

Countries opposed to immigration, such as Poland and Hungary, as well as Austria, however, refuse to help by hosting some of those people.

Years of such disputes damaged the EU’s cohesion, as well as leading it to tighten its external borders and asylum policies.

That has cut the numbers crossing the Mediterranean on unsafe dinghies but also drawn fire from rights groups over drownings and “Fortress Europe” denying help to those in need.

The bloc’s executive now wants overhaul of EU asylum law.

Sources told Reuters the proposal would still include obligatory relocation of asylum seekers among all member states at times of major immigration spikes, the element previously vehemently rejected by several states.

While the Commission’s proposal is expected at the end of September at the earliest, Michel said member states should first work more on external borders and clinching deals with foreign capitals under which the EU offers money and assistance in exchange for them hosting migrants and refugees rather than letting them embark for Europe.

Michel also proposed convergence of asylum benefits across the EU, where rich countries like Germany and Sweden are the most desired destinations, which contributes to uneven distribution of people across the bloc.

“Mandatory relocation is not the alpha and omega of the migration discussion. These threee points are more important,” he said.

Germany, which now holds the EU’s rotating presidency, hopes to get before the end of the year a “political road map” for a future deal to end rows over migration at a time when the EU faces challenges in its ties with Russia, China, Turkey and the United States.

Stressing how tall an order that would be, a senior EU diplomat told Reuters: “We are very far away from any sort of consensus. For different political reasons, the matter is still completely poisonous.” (Reuters)

Divine Intervention? Catholic Church In Belarus Sides With Anti-Lukashenka Protesters

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Divine Intervention? Catholic Church In Belarus Sides With Anti-Lukashenka Protesters

… with growing concern. Religious organizations are among … Europe‘s faith fault line between Eastern and Western Christianity … ” faiths of Catholicism, Judaism, Islam, and evangelical Lutheranism. … suppressed, prompting the European Union and United …

Travel news: EU working on a new ‘traffic light’ system for Covid-19 travel

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Travel news: EU working on a new ‘traffic light’ system for Covid-19 travel

The EU Commission has taken a step … from high-risk (red) areas.
EU Commissioner for Home Affairs, Ylva … Johansson, extolled the EU‘s efforts since the …

EU Reportedly Set to ‘Sideline Chief Negotiator Michel Barnier’ in a Bid to End Brexit Stalemate

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EU Reportedly Set to 'Sideline Chief Negotiator Michel Barnier' in a Bid to End Brexit Stalemate

The EU is set to sideline the bloc’s chief Brexit negotiator Michel Barnier to try to end the persistent deadlock in negotiations, The Telegraph has reported citing sources. European Commission President Ursula von der Leyen is thereby expected to ultimately help arrange a trade deal between the bloc and the UK, with the heads of the 27 remaining member states reportedly set to take over the role of “sidelined” Barnier after von der Leyen’s speech on 16 September.

As an EU diplomat shared with The Telegraph, von der Leyen is expected to “set the scene to sideline Barnier and [the UK’s David] Frost to find a high level political solution”.

The talks on the EU behalf are expected to be led by the European Commission president, German Chancellor Angela Merkel, and President of the European Council Charles Michel.


©
REUTERS / GONZALO FUENTES
EU’s Brexit negotiator Michel Barnier attends the MEDEF union summer forum “La Rencontre des Entrepreneurs de France, LaREF”, at the Paris Longchamp Racecourse in Paris, France, August 26, 2020

The news came as Lord David Frost, Britain’s Brexit negotiator, issued a warning to Brussels suggesting the bloc’s demands on fishing and state subsidies could “limit the progress” potentially made next week.

Indicating that the UK could indeed be eyeing a no-deal divorce from the EU, Frost said that London has been clear about its position from the very beginning:

 “The EU still insists we change our positions on state aid and fisheries if there are to be substantive textual discussions on anything else”.

“We will negotiate constructively but the EU’s stance may, realistically, limit the progress we can make next week”, he concluded.

Frost tweeted the comments after his European counterpart Michel Barnier said that while the UK can retain control over the waters washing its coasts, “the fish which are inside those waters” are “another story”.

The bloc has been scrambling to retain access for its fishing boats, while Downing Street is adamant that British trawlers operating in the area will be given priority.

Separately, Brussels is seeking a “level playing field” on state aid rules that would effectively tie Britain to EU regulations after the transition period comes to a close at the end of the year.

Just yesterday Boris Johnson insisted that the UK will “prosper mightily” regardless of the outcome of the trade talks. Confirming a readiness for “any eventuality”, the prime minister stressed they must make sure people understand that at the end of the year Britain is leaving the EU whatever it takes. “[…] we are leaving the EU, leaving the transition period. We will get through this”, Johnson vowed, reiterating his previous statement that it is “absolutely vital that our partners understand that the UK is going to do what we need to do”.

In late August, after rounds of negotiations on the subject resumed, Barnier lamented that the talks had actually gone “backwards” following months of lockdowns due to the coronavirus pandemic, as both sides conceded a deal appears unlikely.

Two more rounds of trade negotiations are slated for later this month, with the first taking place in London next week.

Turkish expert criticizes EU’s double Standard toward Islam

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Turkish expert criticizes EU's double Standard toward Islam

Turkish expert criticizes EU’s double Standard toward Islam

During an illegal gathering on August 28, supporters of right-wing Danish politician Rasmus Paludan, who leads the anti-Islamic group Tight Direction (Stram Kurs), burned a copy of Holy Qur’an in the southern Swedish city of Malmo.

On Tuesday, (September 1), French Magazine Charlie Hebdo republished offensive cartoons of Prophet Muhammad (Peace be upon Him) on the eve of the trial of suspects in a deadly attack on the paper’s office five years ago. In January 2015, two terrorists attacked the magazine’s offices in Paris, killing 12 people, many of whom worked for the publication. The attack, condemned by Muslims across the world, was allegedly a response to the magazine’s offensive cartoon of the Prophet of Islam (PBUH) a few years earlier.

Anti-Muslim moves have been on the rise across Europe in recent years. Muslim leaders in Europe and around the world have reiterated their unequivocal condemnation of the anti-Muslim acts.

Moreover, the rise of far-right ideology and the propagation of anti-immigration policies have exacerbated the status of religious minorities in Europe particularly Muslims.

To shed light on the issue, we reached out to Turkish researcher and expert Deniz Caner.

“Although the Swedish authorities did not allow the demonstration of provocation against the Quran and imposed an entry ban on the so-called politician, on August 28, far-right street painter Dan Park and Danish racist politician Rasmus Paludan had been in Malmö for two weeks and also made many attempts to provoke Muslims,” Caner said.

“For 2 weeks, it seemed that these provocateurs were expected to burn the Qur’an in a completely helpless manner by the Swedish police,” she added.

Commenting on the European leader’s double standards regarding human rights, the Turkish expert highlighted, “While Europe, which accepts human rights and the rule of law as its basic principle, is very sensitive about anti-Semitism, it is still not able to prevent these ugly attacks against Muslims and Islam.” 

MNA/

EU to reaffirm its support for Greek and Cypriot sovereignty at summit-Michel

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EU to reaffirm its support for Greek and Cypriot sovereignty at summit-Michel

European Union leaders will decide on a “carrot and stick” approach to Turkey when they meet on September 24-25, their chairman said on Friday, proposing a multi-party conference to defuse tensions in the eastern Mediterranean.

European Council President Charles Michel who spoke to Reuters and five other European news agencies in Brussels also said said the EU would reaffirm its support for Greek and Cypriot sovereignty.

The message was sent as a stand-off over oil and gas deposits simmered between EU members Cyprus and Greece on one side and the bloc’s uneasy NATO ally Turkey on the other.

The EU has already imposed minor sanctions against Ankara over the matter and the 27 EU leaders will tackle it again soon in Brussels. Michel, who will host the meeting, said the EU would reaffirm its support for Greek and Cypriot sovereignty.

“We will identify tools in our external policy, a sticks and carrots approach – what tools to use to improve the relationship and what tools to react (with) if we are not being respected,” he said. “We want to be respected.”

Michel, who is due to travel to Greece, Cyprus and Malta before the summit, also proposed an international conference on the eastern Mediterranean involving the key parties and NATO.

“That could be the best way to de-escalate in the region and offer a channel for dialogue,” he said, adding he had already floated the idea with Athens and Ankara. “What is happening, what has been happening the last few weeks, cannot go on.”

Michel said the gathering could discuss the thorny issue of maritime boundaries in the eastern Mediterranean, energy, security and migration. Last month Turkey sent a survey vessel, escorted by frigates, to explore for oil and gas in waters claimed by Greece, a move Athens said was illegal.

A collision between Greek and Turkish warships shadowing the survey vessel last month highlighted the risk of conflict.

Michel declined to discuss the specific incentives or punitive steps the bloc could take with respect to Turkey.

Ankara has long sought an upgrade of its customs union with the EU, a process that has stalled over President Tayyip Erdogan’s sweeping anti-terrorism legislation that underpinned widespread jailings of opponents following an abortive 2016 military coup.

Turkey’s long-standing request to join the EU is all but dead over Erdogan’s perceived authoritarianism.

At the same time, the bloc relies on Turkey to prevent millions of Syrian and other refugees and migrants on its soil from heading to the EU, where migration feuds have spurred the rise of eurosceptic nationalist parties in recent years.

The EU has already promised 6 billion euros to help Turkey host migrants, though Ankara has long complained the money was too slow to arrive. The bloc could agree more such funding in one example of a positive gesture to Turkey.

Granting Turkey’s wish for visa-free travel to the bloc, however, has long been contentious among EU member states that also object to Erdogan’s track record on human rights and the broad, post-coup crackdown on dissent.

Asked about potential EU sanctions before Michel’s comments, a spokesman for Erdogan’s AK Party said the bloc could not expect cooperation from Turkey if it were hit with penalties over the eastern Mediterranean.

(Reuters)

EU Demands Potential Veto on Britain’s Post-Brexit Laws, Regulations – Report

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EU Demands Potential Veto on Britain's Post-Brexit Laws, Regulations - Report

The European Union is demanding a potential veto on Britain’s post-Brexit laws and regulations to be inscribed in the trade agreement, The Times reported on Saturday, citing senior government officials.

According to the newspaper, the UK’s chief negotiator Lord Frost has dismissed this approach.

Since the negotiations have been hampered by Britain insisting on full autonomy after the divorce, the possibility of a no-deal Brexit is looming ahead as both sides have blamed each other for the lack of progress in the previous seven rounds. According to the negotiators, the sticking points include access to fishing waters, the arbitration of legal disputes, and the so-called level playing field, the set of common rules and standards that prevent unfair trade competition.

The eighth round of trade talks between the UK and the EU is due to begin in London on Monday.

European Union brings relief to flood victims in Sudan

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European Union brings relief to flood victims in Sudan

In response to weeks of relentless heavy rains which have caused severe floods in 6 provinces in Sudan, the European Union has provided € 100.000 in humanitarian funding to assist the most affected families.

This EU funding will support the Sudanese Red Crescent in delivering much needed immediate relief assistance, such as shelter, blankets, basic essential items, and providing access to clean water and basic healthcare to 3500 families. It will also be used to sponsor volunteers to communicate on cholera and waterborne disease prevention, risk avoidance, and early warning systems on possible flooding or landslide threats.

The funds will benefit people in Blue Nile, Al Jazirah, and Khartoum provinces, and are part of the EU‘s overall contribution to the Disaster Relief Emergency Fund (DREF) of the International Federation of Red Cross and Red Crescent Societies (IFRC).

Widespread floods and landslides have affected 6 provinces in Sudan after prolonged heavy rainfall, resulting in at least 65 deaths since late July, with over 134.000 people having lost their homes. Damaged or muddy roads are making access to the affected areas difficult. Destroyed water systems and stagnant water can raise the risk of waterborne diseases. For this reason, particular emphasis is being given to sanitation and hygiene measures in the affected areas.

Background

The European Union and its Member States are the world’s leading donor of humanitarian aid. Relief assistance is an expression of European solidarity with people in need all around the world. It aims to save lives, prevent and alleviate human suffering, and safeguard the integrity and human dignity of populations affected by natural disasters and man-made crises.

Through its Civil Protection and Humanitarian Aid Operations department, the European Union helps millions of victims of conflict and disasters every year. With headquarters in Brussels and a global network of field offices, the European Union provides assistance to the most vulnerable people on the basis of humanitarian needs.

The European Union is signatory to a €3 million humanitarian delegation agreement with the International Federation of Red Cross and Red Crescent Societies (IFRC) to support the Federation’s Disaster Relief Emergency Fund (DREF). Funds from the DREF are mainly allocated to “small-scale” disasters – those that do not give rise to a formal international appeal.

The Disaster Relief Emergency Fund was established in 1985 and is supported by contributions from donors. Each time a National Red Cross or Red Crescent Society needs immediate financial support to respond to a disaster, it can request funds from the DREF. For small-scale disasters, the IFRC allocates grants from the Fund, which can then be replenished by the donors. The delegation agreement between the IFRC and ECHO enables the latter to replenish the DREF for agreed operations (that fit within its humanitarian mandate) up to a total of €3 million.

For further information, please contact:

Mathias Eick, Regional Information Officer, [email protected], or +254-722 791 604

Issued on: Khartoum 23 August 2020

Discussions on ways to further advance the EU-Sri Lanka bilateral engagement

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Discussions on ways to further advance the EU-Sri Lanka bilateral engagement

Sept 04, Colombo: Ambassador of the Delegation of the European Union in Colombo Denis Chaibi along with the EU Ambassadors of Italy, the Netherlands and Charge d’ Affaires of the Embassies of Romania, Germany and France paid a courtesy call on Foreign Minister Dinesh Gunawardena on 2 September 2020.

The Ambassadors offered congratulations to the Foreign Minister on his re-appointment and expressed the desire for continued closer cooperation, the Ministry of Foreign Relations said.

It was noted that Europe was the number one destination for Sri Lanka’s exports and a major source of foreign direct investment and tourism.

The Ambassadors said that Sri Lanka has performed remarkably well in controlling the spread of COVID-19 and as a result, they were confident that European tourists would return to Sri Lanka, once the airports were reopened.

The Ambassadors also discussed the status of EU development assistance to Sri Lanka and expressed the desire to support the government’s economic development priorities. They briefed the Foreign Minister on the EU assisted ongoing projects in agriculture, vocational training, food safety, among others.

The Ambassadors also discussed proposed reforms and recent political developments following the election of the new government.

State Minister Tharaka Balasuriya and Foreign Secretary Admiral Prof. Jayanath Colombage also participated in the meeting.