GBP shoots higher
Bloomberg reports that Theresa May has some new ideas on the Irish border.
"U.K. Prime Minister Theresa May is preparing to make a significant new Brexit offer to the European Union in an attempt to open the door to a deal, according to a senior British government official," Bloomberg reports.
GBP/USD jumped to 1.3116 from 1.3022 on the headlines but it's back to 1.3074, in part because this is similar to something Robert Peston reported earlier today.
This new deal is a backstop and would only apply as a last resort in case a deal isn't reached.
However it's conditional on the UK having full access to the EU customs union, which is a longshot.
I don't think this is a headline to buy but I do think a deal will get done. The EU has already proposed allowing Northern Ireland to have trade with the Irish Republic without full checks, essentially saying it will give them a waiver because it's a small economy. However May has been grandstanding on what's a generous offer because she says it would break up the UK.
Update: The full report is out now.
