The pound is surging after EU negotiators hint at a major Brexit compromise
- The British pound is surging after European Union negotiator Michel Barnier hinted at major Brexit compromise.
- "We are prepared to offer a partnership with Britain such as has never been with any other third country," Barnier said at a news conference on Wednesday afternoon.
- Traders welcomed his words, with the pound gaining close to 1% against the dollar on the comments.
- Watch the British pound trade in real time here.
The British pound has roared higher on Wednesday after the European Union's chief Brexit negotiator Michel Barnier suggested the bloc is ready to enter into an unprecedented "third country" relationship with the UK after it leaves the EU.
"We are prepared to offer a partnership with Britain such as has never been with any other third country," Barnier said at a news conference on Wednesday afternoon.The more conciliatory stance of Barnier, who has been one of the strictest EU figures during negotiations, was looked on favourably by traders in the pound, with the currency gaining close to 1% against the dollar after the comments.
At 3.30 p.m. BST (10.30 a.m. ET), around 15 minutes after he spoke, the pound is trading at $1.2993, a gain of 0.97% on the day, as the chart below illustrates:
"While this doesn't mean the EU's red lines have changed - in fact he explicitly confirmed that they must be respected, along with the UK's - it does suggest that more constructive conversations can happen to find a workable solution that suits both sides, should one exist," Craig Erlam, senior market analyst at Oanda said in an email.
"That's a big change from the focus on punishing the UK for voting to leave which appears to have been the case for the last two years."
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