UK & US Trade Deal Odds Take Nosedive as EU Deal Holds Firm

UK & US Trade Deal Odds Take Nosedive as EU Deal Holds Firm
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A US deal was to be hailed as a major coup in the wake of the UK leaving the EU but it's proving difficult to strike

The UK’s hopes of securing a trade deal with the USA before the end of the year have taken a hit in recent weeks.

And the latest politics betting odds suggest there is little chance of the UK securing a deal with their counterparts across the Atlantic before 2020 is out.

The UK have been working on trade deals with countries around the world ever since the Brexit vote in 2016.

Brexiteers promised 40 independent trade deals with other nations would fill the gap left by exiting the EU.

So far, they have achieved around 50% of those. Yet the two big deals still left to be negotiated are ones with the US and the EU.

US Trade Deal Woes

Boris Johnson was bullish about his chances of securing a deal with Donald Trump’s United States when the UK PM secured his election victory last December.

However, since then the coronavirus, economic instability and the impending US presidential election have all snagged at those hopes.

A US deal was to be hailed as a major coup in the wake of leaving the EU but the chances of it happening have plummeted in less than a month.

Back in July the US politics betting markets had a US-UK deal priced at 16/9 (36% chance). Fast forward five weeks and the odds have slimed to 37/5 (11.9% chance).

“Is it going to happen this year? Basically, no,” one official told the Financial Times.

Concerns over the US trade deal have been raised in Parliament, with opposition MPs worried the UK will accept reduced standards on food, animal welfare and workers’ rights to get an agreement through.

Attention Turns To EU

Meanwhile, the Conservatives are still negotiating their long-fraught trade deal with the EU, which increasingly looks as though that may not be complete by 2021 either.

The UK officially departed the EU in January to trigger an 11-month withdrawal period, whereby a deal on trade, free movement, fisheries and other economic issues could be ratified.

But Johnson’s own end-of-July deadline was missed, and relations between the two camps are fraught.

Downing Street insists a deal can still be done by the end of the year but fisheries and competition rules remain the core sticking points.

And the betting markets reflect the growing unease that a deal won’t be concluded. Odds of 21/20 are quoted on the deal being rubber-stamped by 1 January 2021, compared to 4/7 on the EU and UK defaulting onto World Trade Organisation terms.

Brexiteers insisted a deal with the EU would be the “easiest in human history” when setting out their store for the early rounds of negotiations.

But four years on and the two prize deals – with the EU and the US – are still some way off completion.

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