UK Politics: Are the Brexit red lines about to break?

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The FTSE 100 has suffered a sustained loss over the last week amid talk of a no deal Brexit
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Could the EU could be prepared to remove some of the perceived barriers that have stopped the UK from passing the Brexit deal through Parliament? The Tradefair team brings you the latest from UK politics...

"What I am hearing from European politicians and commentators is that they do take this issue very seriously, they understand the challenge that we have got at home and generally - not all of them, but many of them - want to help."

- Chancellor Philip Hammond

With Brexit just a couple of months away and no apparent way out of the impasse, it seems that the EU might now be willing to drop some of the red lines - though not the insistence on an Irish border backstop.

This was the view of Chancellor Philip Hammond, who has claimed the EU might be willing to move a little to help a modified withdrawal deal pass through the Commons.

While he did not expect the backstop to be scrapped, he said some EU leaders were "looking at what they can do" to make changes to it. Of course, whether those changes would be anything major and, most importantly, enough to mollify sceptics in Parliament, is another question.

Is the EU willing to talk?

This may not be a matter of idle speculation. Speaking to the BBC's Newsnight programme, Commons leader Andrea Leadsom said the EU is likely to be willing to grant the UK a "couple of weeks" after March 20 to get a deal through Parliament, the sort of talk that suggests maybe something really is in the works.

All this is happening as both sides react to the prospect of a no-deal. In the EU, perhaps the greatest concern is felt in Ireland, which has pushed the backstop most. Taoiseach Leo Varadkar has warned troops may have to be stationed on the border if there is no deal, while the Confederation of British Industry has published details of its projections for each region of the UK in the event of such an outcome - all of which are distinctly gloomy.

Speaking on BBC Radio 4's Today programme from the World Economic Forum in Davos, Mr Hammond agreed the outlook after no deal is not good, with "severe disruption" in prospect.

This, he suggested was what has prompted some in the EU to plan to move. He said: "What I am hearing from European politicians and commentators is that they do take this issue very seriously, they understand the challenge that we have got at home and generally - not all of them, but many of them - want to help.

"They are not prepared to compromise on the fundamental principles that the EU has set out, but they certainly are looking at whether there is anything they can do without compromising those principles."

Markets suffer when uncertainty looms

The ongoing talk of a 'no-deal' Brexit continues to impact the UK's major markets, with the FTSE 100 suffering a sustained loss over the last week. The value of the nation's premier stock exchange witnessed a combined loss of more than 200 points since January 22nd, with the market dipping from 6,970 points at the opening of trading last Tuesday to just over 6,700 today (January 28th).

With the uncertainty of Brexit continuing to make things difficult for companies across all industries, it now remains to be seen if a change in the Brexit deal could salvage some semblance of clarity for the UK's businesses in the months ahead.

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