Brexit/ EU Summit: What to expect? - HSBC

HSBC analysts offer their thoughts on what to expect from the 2-day EU Summit starting today, with the agenda mainly centered on the Brexit negotiations.

Key Quotes:

“The European Council will discuss the progress of the Brexit talks at its October summit. To move on to next phase of talks - over the future relationship and a possible transition deal - the EU needs to assess the progress of the first phase, which covers the terms of the divorce, including, most notably, the rights of citizens, the status of the Northern Irish border with Ireland and a financial settlement.

Things are not looking good for the UK. Chief Negotiator Michel Barnier said at the conclusion of the latest round of talks that he was not in a position to make any recommendations, while the European Parliament on 3 October overwhelmingly passed a motion decreeing that progress had been insufficient.

At this stage, a positive decision from the Council would be a major upside surprise. It is possible the Council could agree to discuss a potential transition deal before the second phase, which might be a boost for the UK. However, if, as we expect, the Council says the talks have not progressed enough, the UK will have to pin its hopes on the next summit, currently scheduled for 14-15 December.”