EU member states have today given permission for Brexit negotiations to enter a new intensive phase, the so-called tunnel.
The tunnel is slang for discussions held in secret between a small group of negotiators to try and ensure that offers and counter offers are not disclosed.
The news will be a boon for Prime Minister Boris Johnson’s government, which had been pushing for negotiations to enter this phase.
Sky New reported that senior EU sources had confirmed that the intense negotiations – the tunnel – will now begin.
The Irish Times quoted a European Commission official saying: “The tunnel is not a place, but a state of mind.”
Seeming progress on a Brexit deal follows An Anglo-Irish meeting yesterday between Johnson and Ireland’s Prime Minister Leo Varadkar.
The pair issued a joint statement which said they see “a pathway to a possible deal”.
Earlier today The EU’s chief negotiator Michel Barnier and UK Brexit secretary Stephen Barclay had a “constructive” meeting on Brexit.
Barnier told assembled reporters that Brexit negotiations were like mountaineering.
“Brexit is like climbing a mountain. You need vigilance, determination and patience,” he said.
This morning European Council President Donald Tusk said he had received “promising signals” from Irish Prime Minister Leo Varadkar on Brexit.
Tusk tweeted “The UK has still not come forward with a workable, realistic proposal. But I have received promising signals from Taoiseach Leo Varadkar that a deal is possible. Even the slightest chance must be used. A no deal Brexit will never be the choice of the EU.”
Sterling has rocketed on the news, passing $1.26.
Neil Wilson chief markets analyst for Markets.com said: “The tunnel news gave traders a green light to bid up sterling again, on hopes that a deal is in the offing. We are witnessing a massive short squeeze. The stops have come out with GBPUSD shooting north of 1.26 and blowing out resistance levels along the way.”
Naeem Aslam of Think Markets said: “The ludicrous element is that we do not even know what is inside this deal which has made everyone so optimistic about everything. Speculators are just pushing the prices higher.
“The odds of getting caught on the wrong side are high but we believe that the traders are paying attention to the beautiful phrases used by the lawmakers.”
Picture credit: Getty