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  • Time limited backstop is not a backstop at all.
  •  We will judge UK proposal when we see it, but it will need to have same effect as backstop.
  • UK parliament will act to prevent a no-deal Brexit.

The Irish Foreign Minister is being reported saying that  if there is a proposal that involves customs checks on the island of Ireland, ‘that in itself is bad faith’. Indeed, the remark reflects the sentiment from an overnight with respect to UK PM Boris Johnson’s proposed backstop solution which was leaked and regarded as a non-starter.  Ireland’s deputy prime minister dismissed it as being so in a tweet just before midnight where he said it was the time that the EU and Ireland had a “serious proposal”.

Additional comments from the Irish Foreign Minister:

  • Let’s see what happens tomorrow, it is too early to say what is in the proposal.
  • ‘The reports we are hearing are concerning to put it mildly’.
  • Always rejected concept of time limit on backstop unless clear what happens after.
  • Time limited backstop is not a backstop at all.
  • Irish foreign minister Coveney: not seen UK  proposals yet – virgin media interview.
  • Does not look like basis for deal if report is correct (refers to telegraph newspaper.
  • UK parliament will act to prevent a no-deal Brexit.
  • We are not going to sign up to managed border infrastructure as a permanent arrangement on the island of Ireland.
  • The government won’t be signing up on a voluntary basis to border checks on this island.
  •  We will judge UK proposal when we see it, but it will need to have same effect as backstop.

Extra reading:  

  • Brexit: Extracts of UK PM Johnson’s speech, hints of the proposal to EU

FX implications:

  • GBP/USD suffering ‘back to the backstop drawing-board’ set-backs below 1.23 handle