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There are reports that the UK Prime Minister, Boris Johnson, is prepared to walk away from EU negotiations if doesn’t get what he wants.

The UK PM has only a matter of weeks to provide clarity on new trading arrangements with Europe to avoid disruption, delays and possible job losses at the end of the year, business groups have warned, according to the Independent:

Three days on from the UK’s formal departure from the EU, the prime minister is to use a high-profile speech on Monday to set out his plans to negotiate a comprehensive free trade agreement to an unprecedentedly tight deadline of 31 December, which he insists he will not extend.

Addressing ambassadors and industry leaders, Mr Johnson will say that “no achievement lies beyond our reach”, as he sets out No 10’s priorities for the imminent trade talks, including no alignment with the EU.

“There are two likely outcomes in negotiation – a free trade deal like Canada or a looser arrangement like Australia – and we are happy to pursue both,” a government source said on Saturday.

  • Brexit, the beginning of a new era

FX implications

GBP/USD  rallied from below the 1.30 hande to a high of 1.3209 on Brexit day following a hawkish outcome at the BoE the prior day.

However, we could be in the throes of a final clear out of stale buy stops before the real challenges now lay ahead for the UK as the focus now turns more clearly from the “Brexit deal” to a “trade partnership” with the EU.