Boris Johnson’s fledgling Brexit deal causes major split among Tory hardliners

• Sun reports a major split among Tory Eurosceptics over UK PM's Brexit deal.
• A risk-on day with respect to Brexit breakthrough supports UK markets and the Pound.

The Sun has reported that there has been a major split among Tory Eurosceptics over whether to back Boris Johnson’s Brexit deal.

"While some senior members of the hardline European Research Group declared they were ready to back the PM’s new customs partnership plan for Northern Ireland, others began speaking out to blast it," the news company wrote.

The article written in the Sun follows a risk-on day with respect to UK markets and the Pound as a breakthrough between the EU and UK with respect to the sticking points of a Brexit deal emerged overnight.

However, "Mr Johnson is facing a knife-edge vote in the Commons to pass any deal he agrees in Brussels, and must slash the number of Tory rebels to single figures", the Sun noted and explained that Former Cabinet minister Owen Paterson became the first senior MP to denounce the fledgeling deal in public.

The Sun's article:

"In a blow for No10, the ex-Northern Ireland Secretary dubbed it “absurd” and “unacceptable” in an interview with The Sun.

When would any other country ever give up part of its territory as part of trade talks?

Owen Paterson MP

But while calling Boris’s talks with Ireland boss Leo Varadkar as “encouraging”, Mr Paterson said: “Concerns remain that the EU will seek to trap Northern Ireland permanently in the EU Customs Union by trying to reheat the failed ideas of customs partnerships or single customs territories that proved so disastrous for Theresa May.

“We await the full details of the new deal to see exactly how they address the objections to the dead Theresa May deal, but dual-tariff systems like this would be, as Priti Patel has said, unacceptable.”

He added: “When would any other country ever give up part of its territory as part of trade talks? It would be particularly absurd for Northern Ireland.

“It would shatter the Belfast Agreement’s Principle of Consent and completely undermine Northern Ireland’s status as an integral part of the UK. We must not go down this route.”

Mr Paterson also signed the “Brexit Pledge” on Tuesday night, a campaign calling on all MPs to agree to leave the EU on October 31, with or without a deal.

Former Tory leader Iain Duncan-Smith was also said by other MPs to also be unhappy and is reported to have “exploded” at senior No10 officials over how the PM has kept almost everyone in the dark over the negotiation.

Sir Bill Cash was also said to be “worried” about how much sovereignty the province would have to surrender to the EU over the plan."

FX implications:

GBP/USD bulls may find a tough time in territories above the 200-DMA considering the hurdles ahead, especially in the DUP. Johnson is going to have a very tough time selling his proposal to the DUP if too many concessions are made to the EU and it in any way jeopardises N.Ireland's constitutional and economic place in the UK.