Reuters reports on the matter


The report cites an internal document from the German government, saying that they are urging other EU member states to prepare for a no-deal Brexit with the German foreign office now convinced that the transition period will not be extended.

"It is therefore important to preserve the unity of the 27, to continue to insist on parallel progress in all areas and to make it clear that there will be no agreement at any price. Therefore, both national and European contingency planning would now have to start in order to be prepared for a no-deal 2.0."

I guess it's good to know how they feel on the issue but even if it is tough to materialise, I don't think we can rule out any "soft agreements" or something of a similar nature when both sides get into talks and the "hot phase" later on in the year.

That said, even when you try and grasp the bigger picture of Brexit, I'm doubtful that we will see as dramatic an impact as what transpired in 2016 in the market and the pound.

Sure, there will be a knee-jerk and short-term reaction if we do end up with a no-deal outcome, but will it be as devastating as four years ago? I'm not sure. I mean, we have had four years to try and digest all of this and cable is still 16% lower since.