EU guidelines for Brexit relationship did not contain many surprises – Danske Bank

Yesterday, the EU published its draft guidelines for post-Brexit relationship, which did not contain many surprises, notes Mikael Olai Milhøj, Senior Analyst at Danske Bank.

Key Quotes

“The EU wants tariff-free and quota-free trade but reiterated that there can be no cherry picking by choosing which parts of the EU single market the UK wants to be a part of. The EU still thinks the only likely solution is a free trade agreement like Canada. Services will only be included with restrictions and there will be no special access for banks. The UK Chancellor of the Exchequer Philip Hammond said it is “hard” to see an agreement not covering services, as the EU has a surplus in goods while the UK has a surplus in services. This is in line with our base case, as we expect a Canada-style FTA but with more services included.”