We have increased the probability of a Brexit deal to 20% – Danske

In its latest research reports, Danske Bank came out with an upbeat analysis of Brexit developments while conveying the increased odds of a Brexit deal. However, their base case expectations of another Brexit extension followed by a snap election remains on their radar.

Key quotes

“Recent days have been positive for the Brexit negotiations and hence we have increased the likelihood of a deal to 20% (from below 10% previously).”

“However, the pathway is still full with obstacles. First of all time is very limited. Also, the rest of the EU system is less upbeat than the Irish and think a lot of work still has to be done.”

“Even if the UK and EU27 agree on a deal, PM Johnson may not have support in Parliament.”

“Our base case remains another Brexit extension into 2020 followed by a snap election, but the probability has declined to 70% from 85% previously.”

“We think the likelihood of a no deal Brexit by 31 October is very slim (5%) due to the Brexit Delay Bill, which seems extremely watertight.”