Brexit in the week from 13/4 – 19/4/2020

Fundamental analysis

There are already more than 120,000 infected with COVID-19 in Britain. The contagion also hit two key negotiators for the EU and the UK, so personal negotiations on the trade agreement were canceled. While David Frost and Michel Barnier were being treated, their teams worked hard to draft the individual documents. Both men then attended a video conference on Wednesday last week, agreeing on a further timetable for negotiations on the trade agreement.

The next round of negotiations should start in the week of April 20, 2020. Britain's negotiator David Frost confirmed that the UK is not planning to extend the transitional period, which should end on December 31, 2020. However, the European diplomats are convinced that Britain will ultimately request an extension. The request for extension of the deadline would have to be received by June 30, 2020.

The UK has failed to produce a draft legal text on fisheries so far. The EU diplomats are afraid of the British to gain the upper hand by attempting to delay difficult issues until the last minute. EU sources insist there will be no agreement on anything without a deal on fisheries.
Regarding economic data, no significant data was reported in Britain last week. Attention was paid to the USA, where a further increase in the claims for unemployment insurance was reported. Last week, another 5.2 million unemployed people applied for insurance in the US. In total, since March 19, 2020, 22 million unemployed have applied for support. Before the outbreak of the pandemic, the total US workforce peaked in February 2020, with a total of 165 million people employed. That means that unemployment in the US is currently around 13%.

Retail sales in the US fell to -8.7% in March, the previous month it was -0.4%.