UK Markets closed
  • FTSE 100

    7,027.58
    +59.28 (+0.85%)
     
  • FTSE 250

    22,883.39
    +206.11 (+0.91%)
     
  • AIM

    1,232.54
    +4.45 (+0.36%)
     
  • GBP/EUR

    1.1675
    -0.0013 (-0.11%)
     
  • GBP/USD

    1.3754
    -0.0013 (-0.0977%)
     
  • BTC-GBP

    24,874.23
    +144.31 (+0.58%)
     
  • CMC Crypto 200

    786.33
    -7.40 (-0.93%)
     
  • S&P 500

    4,411.79
    +44.31 (+1.01%)
     
  • DOW

    35,061.55
    +238.20 (+0.68%)
     
  • CRUDE OIL

    72.17
    +0.26 (+0.36%)
     
  • GOLD FUTURES

    1,802.10
    -3.30 (-0.18%)
     
  • NIKKEI 225

    27,548.00
    +159.80 (+0.58%)
     
  • HANG SENG

    27,321.98
    -401.86 (-1.45%)
     
  • DAX

    15,669.29
    +154.75 (+1.00%)
     
  • CAC 40

    6,568.82
    +87.23 (+1.35%)
     

There's now a 60% chance of a 'no-deal' Brexit

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
·Head of Yahoo Finance UK
·3-min read
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

WATCH: Boris Johnson warns there is a 'strong possibility' of no trade deal with EU

The chance of a no-deal Brexit between the UK and the European Union rose to over 60% on Friday morning.

Betting site Smarkets put odds at 60.61% as of 8.10am London time for the UK and EU to not sign a trade deal in 2020. This is up from 53% on Thursday and 19% that was priced in at the beginning of December.

“The pessimistic opinions from the UK and EU are a clear sign that we are in the end-state negotiations with olive branches being offered in an attempt at compromise,” said Sarbjit Bakhshi, head of political markets to Yahoo Finance UK later in the morning.

“Our market currently gives a 45% implied probability of a deal taking place this year as our customers try to see through the negotiating tactics and the self-interest of each side.

“However, in the last seven days trading on our market has put a no-deal outcome as the most favoured outcome at 56%. This could suggest that the positions of the UK and EU are increasingly irreconcilable in the time available and that the UK may be heading for a no-deal-by default outcome.

Chart: Smarkets
Chart: Smarkets

Overnight, UK prime minister Boris Johnson dampened hopes of a deal being sealed with the 27-nation bloc by declaring that there is a “strong possibility” of a no-deal Brexit.

The UK has until Sunday (13 December) to reach a trade agreement with the EU, ahead of 1 January when Britain finally exits the European Union.

Initial downside impact was truncated as the Bank of England declared that UK banks remain strong enough to weather the COVID-19 pandemic and have done all they can to prepare for Brexit, according to its bi-annual financial stability report published on Friday.

But the pound, the bellwether of Brexit sentiment, tanked by 9am local time against the US dollar (GBPUSD=X) and euro (GBPEUR=X) as the likelihood of a no-deal Brexit sunk in.

Chart: Yahoo Finance
Chart: Yahoo Finance

‘’With the UK now looking like its hurtling towards a no-deal Brexit, investors should adopt the brace position for swings in sterling and shares in domestic focused companies,” said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.

“Warnings from prime minister Boris Johnson, that companies should prepare for a no-deal scenario, will not have added to confidence, given that there are just three weeks until January 1st, when WTO rules would come into force. However, investors would be wise to look through the short-term noise and stay anchored to their long-term plan.

“The head start the UK has made with vaccine rollouts should also help the UK economy get back on its feet more quickly, to withstand the headwinds a no-deal Brexit will bring to business.

“This week alone has shown us how quickly things can turn but don’t chase the changing headlines. Trading quickly, chopping and changing your portfolio day-to-day, is going to be tricky at best. Don’t make long-term investment decisions that impact your financial future based on short-term news.”

WATCH: 10 ways to Brexit proof your finances

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting