So much for that ultimatum.
In an effort to win a deal with the EU27 that might have a chance of making it through the House of Commons (where Theresa May's hated withdrawal agreement was defeated three times), Prime Minister Boris Johnson's negotiators have proposed what Sky News described as a "pared-down free trade agreement" to hopefully end the Brexit stalemate by striking a mutually amenable deal that could be passed by the Oct. 31 'Brexit Day' deadline.
Johnson has insisted that the UK will leave the EU by the Oct. 31 deadline, though MPs have already passed a law requiring the PM to request an extension if there's no deal by Oct. 19 (following a weekend summit that's widely seen as the last chance for both sides to strike a deal). The PM and his Irish counterpart met at Thornton Manor on the Wirral, Merseyside in Ireland on Thursday for what their offices described as a "private meeting" ahead of next week's European Council meeting (the above-mentioned summit).
Though the latest British proposal isn't "fully formed", the free-trade agreement pitched by Johnson was described to Sky as a "pared down free trade agreement" that might form the foundation of a plan that could end the Brexit stalemate.
Johnson's team is optimistic about the plan, and believes that the support of Irish PM Leo Varadkar might help convince the rest of the EU27 to come along. Several EU nations have already pledged to support an agreement if Varadkar, whose country will be most heavily impacted by Brexit, gives it his seal of approval.
Traders were convinced, and the news sent GBP soaring all the way to $1.2460, erasing all of its losses for the month of October, and then some.
Per Sky, UK negotiators have become extremely frustrated with Michel Barnier, the lead EU negotiator, claiming that his opposition to British proposals, along with his overall refusal to give any ground in the negotiations, doesn't make sense. Johnson's latest proposal supposedly satisfies several of the requirements that Barnier laid out in a speech last October. However, when Johnson released his plan, Barnier swiftly lambasted it as unworkable.
So they have shifted their focus to winning the support of Varadkar, whom the British believe can convince the rest of his EU27 compatriots to come along.
However, one senior Brexit reporter, ITV's Robert Peston, warned that Johnson's optimism might be a "ruse" to lessen the pressure from Tory backbenchers and give Johnson more room to maneuver.
I pass on, with little confidence or real understanding, that @BorisJohnson seems to believe that @LeoVaradkar and Dublin have lessened their objections of principle to his Brexit offer. Maybe both sides are moving in a signficant way. We'll see. What I should point out...— Robert Peston (@Peston) October 10, 2019
however is that if the negotiations were to collapse this weekend, that would be the worst timing for Johnson, because it would spur rebel Tory MPs to use SO24 next week to take control of commons business - and they would try to get a motion passed in favour of a...— Robert Peston (@Peston) October 10, 2019
referendum on May's gone-but-not-forgotten Brexit deal. When that flopped (as it probably would), the rebels would go for a vote of no confidence, to engineer Johnson's removal. As I understand it, this has been their plan. However if Dublin and [tomorrow] Brussels signal a...— Robert Peston (@Peston) October 10, 2019
deal is a genuine possibility, even the ultras among Tory rebels will feel obliged to give Johnson and his negotiators the time and space to try and conclude that deal. In other words, Johnson's optimism and apparent readiness to adapt his offer may be real or may...— Robert Peston (@Peston) October 10, 2019
be a ruse. Either way, the hint of an entente is perfectly timed, to limit the risk that backbench MPs take Johnson hostage before next Thursday's EU council meeting, when EU leaders face their darkest Brexit hour and hardest Brexit decision - namely whether to close the door...— Robert Peston (@Peston) October 10, 2019
on a Brexit offer from Johnson they hate, and trust that backbench MPs will usurp him, rescue them and prevent a no-deal Brexit. In keeping the talks going, Johnson is massively increasing the jeopardy for EU leaders.— Robert Peston (@Peston) October 10, 2019
A Free-trade agreement would remove tariffs on goods produced by both sides, but it wouldn't entirely eliminate the need for customs checks.