No more pound increases. Johnson adamant to the EU.

Great Britain officially from the end of January is outside the Community. This is not synonymous, except that all formal issues have already been completed. As early as January, the President of the European Commission mentioned that there is still a long way to go before the EU and UK to reach a consensus on regulating trade issues. Boris Johnson's attitude does not indicate that it should be a simple and pleasant conversation. What's more, recent comments on this issue did not have an optimistic overtones and even further supported the agonizing issues regarding the lack of settlement between the parties.

Negotiated negotiations

Boris Johnson in Monday's speech emphasized that in the absence of concessions from the European Union it would be ready to break all trade negotiations with Brussels. The Prime Minister dislikes many things the Community persistently holds (especially regarding regulations and changes in the rules on unfair competition). Boris Johnson's comment appeared right after Michel Barnier, EU chief negotiator for Brexit, stressed that the UK would have to comply with any changes in the fight against unfair competition. Two biting rhetoric of both men strongly overrated yesterday's pound.

Chart EUR / GBP, H1 interval. Source: xNUMX XTB xStation

This situation had a positive effect on the euro, which quickly gained against the British currency. The appreciation of EUR against GBP seems to be a quite real scenario, if we take into account reports of increasingly difficult negotiations with Johnson. It is worth remembering that earlier the pound "enjoyed" reacting with strong demand movements to all reports related to leaving the EU and the relentless policy of the prime minister. At present, every Johnson's relentless stance causes a decrease on GBP. It is possible that in the near future the British currency will re-evaluate the real economic risk associated with a possible lack of trade agreement between the parties. Naturally, the UK that was previously present in the EU was strongly connected with the Community in economic terms. Therefore, it is hard to expect that all contacts will now be broken and irretrievably lost. This, of course, will not really happen.