Pound jumps on Brexit agreement

The UK and EU agreed to a draft Brexit agreement on Thursday, causing the pound to jump.

After London and Brussels confirmed they will both have “a trading relationship on goods that is as close as possible”, the pound rose almost 1% to $1.2893.

The European Council said that political declaration had been “agreed in principle”.

European Council, President Donald Tusk, tweeted: “I have just sent to EU27 a draft Political Declaration on the Future Relationship between EU and UK. The Commission President has informed me that it has been agreed at negotiators’ level and agreed in principle at political level, subject to the endorsement of the leaders.”

The 585-page document covers issues including the divorce bill, the transition period and citizens’ rights.

The draft document reads: “The future relationship will be based on a balance of rights and obligations, taking into account the principles of each party.”

“This balance must ensure the autonomy of the union’s decision-making and be consistent with the union’s principles, in particular with respect to the integrity of the single market and the customs union and the indivisibility of the four freedoms.”

“It must also ensure the sovereignty of the United Kingdom and the protection of its internal market, while respecting the result of the 2016 referendum including with regard to the development of its independent trade policy and the ending of free movement of people between the Union and the United Kingdom.”

The prime minister will return to Brussels on the weekend for further Brexit talks with Juncker.

She said in a statement on Thursday: “The text has now been agreed between the US and the European Commission. The draft text agreed is a good deal, it honours the vote of the British people by taking back control of our borders, law and money.”

“It ends free movement once and for all, instead we will introduce a new skill-based immigration system.”

“It ends jurisdiction of the European Court of Justice in the UK. It also means an end of sending vast amounts of money to the EU,” she added.

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Safiya focuses on business and political stories for UK Investor Magazine. Her interests include international development, travel and politics.