European Union's Michel Barnier to spell out Brexit transition demands

Legislation meant to smooth Britain's exit from the European Union moves a step closer to becoming law on Wednesday, as ministers begin working out what they want from Brexit.

The development comes after European Union leaders last week signed off on the first stage of Brexit negotiations ending more than a year of stalemate over Britain's bill for leaving the bloc, as well the fate of the Irish border and European Union migrants.

He also revealed the Bank's plans are based on agreement being struck on a transition period by the end of the March next year.

He stressed that the United Kingdom would be expected to continue abiding by European Union rules throughout the transition period - including allowing the free movement of people within the bloc.

"The transitional arrangements should apply as from the date of entry into force of the Withdrawal Agreement and should not last beyond 31 December 2020", the guidelines said.

In response to Barnier's warnings to the City, Carney said: "I don't accept the argument that just because it hasn't been done in the past, it can't be done in the future".

Mrs May told Prime Minister's Questions in the House of Commons: "We are not going to exclude Gibraltar from our negotiations from either the implementation period or the future agreement".

The BOE could not immediately be reached for comment.

Britain will maintain access to the European single market as it transitions out of full EU membership, EU chief negotiator Michel Barnier said on Wednesday.

"The pressure we have seen against sterling today is largely reflecting remaining uncertainties around Brexit negotiations", said Alexandra Russell-Oliver, a strategist at Caxton FX.

In a move to allay fears of a pledge for "regularity alignment" with the European Union in the divorce bill, the Prime Minister said she wants "a deal which secures the best possible trading terms with the European Union, enables the United Kingdom to set rules that are right for our situation, and facilitates ambitious third country trade deals".

Brexit Secretary David Davis is on record as saying he wants Britain's free trade deal to be "Canada plus plus" and include financial services.

Mrs May refused to confirm if MPs would get a "meaningful" vote to approve an exit deal despite rebel Tories joining the opposition to defeat the Government on the issue last week and write it into law.

  • Jon Douglas