GBP climbs 1% after Macron open to Irish backstop alternatives

Pound Sterling gained against the euro and dollar on Thursday after French President Emmanuel Macron and his counterpart in Germany Angela Merkel said they were open to alternative solutions

Following the news, the pound rose by 1% to 1.1038 against the euro – a new three-week high – while sterling climbed to 1.2240 against the dollar.

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Alternative Irish backstop solution could avert no-deal Brexit

While the Macron and Merkel did say that they are open to hearing alternative options to an Irish backstop, both stressed that any proposal must respect the integrity of the EU single market and must not destabilise relations between the North and the Republic of Ireland.

‘We can find a solution to the backstop by October 31…we can work on finding a regime that keeps the Good Friday Agreement and also ensures the integrity of the single market,’ Merkel told Boris Johnson during a meeting in Berlin on Wednesday.

EU will not renegotiate an entirely new Brexit deal

Despite both EU leaders being open to tweaking the Irish backstop, Macron made it clear that there isn’t enough time to renegotiate the deal wholesale.

‘I want to be very clear: in the month ahead, we will not find a new withdrawal agreement that deviates far from the original,” Macron said during his meeting with Johnson at the Elysee Palace.

If Johnson can find an acceptable solution to the Irish backstop before the October 31 deadline, however, it would allow the UK to avoid a no-deal Brexit.