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Hammond sees U.S. free trade deal 'straightforward'

By David Lawder
Britain's Chancellor of the Exchequer Philip Hammond arrives in Downing Street, London March 29, 2017. REUTERS/Hannah McKay

By David Lawder

WASHINGTON (Reuters) - A free trade deal between Britain and the United States would be "relatively straightforward" to negotiate because the two countries are similar, high-wage economies with floating exchange rates, Chancellor of the Exchequer Philip Hammond said on Friday.

Hammond said U.S. House Speaker Paul Ryan and a bipartisan congressional delegation expressed strong support for a U.S.-UK trade deal during a visit to London earlier this week, calling it a "high-level commitment."

"There is clearly a very strong political momentum behind this deal, and as soon as we are able to, as soon as it's possible within the terms of our obligations to the European Union, we will begin preliminary discussions with the United States," Hammond said.

Speaking to reporters at the British Embassy in Washington during the International Monetary Fund and World Bank spring meetings, Hammond said that Britain represents none of the threats to the U.S. economy that President Donald Trump has voiced about other trade deals such as the North American Free Trade Agreement.

"We're not a low-wage country, we're not a country with a managed exchange rate, the Americans don't see anything about the UK they find to dislike in trade terms. So we ought to be able to do a bilateral trade deal relatively straightforwardly," he said.

Before any trade talks with Washington can happen however, Britain must complete its negotiations for exiting the European Union, a process that could take up to two years.

Asked about the potential for U.S. financial deregulation, including new studies ordered by Trump of regulatory burdens imposed by the Dodd-Frank post-crisis reform law, Hammond said he believes these efforts may be "incremental" steps more aimed at easing burdens on smaller banks.

"I sense that the mood is moving more towards incremental change rather than tearing the edifice down," Hammond said of the Dodd-Frank law. "We have no sense that the U.S. is about to embark on something that would endanger the stability of the international financial system or would endanger our financial services relationships with it."

(Reporting by David Lawder; Editing by Meredith Mazzilli)