The latest tussle between Minister for Finance Paschal Donohoe and the State’s budgetary watchdog played out this week as Donohoe rebuffed recent accusations of fiscal mismanagement. Meanwhile, in Strasbourg, newly-elected European Commission president Ursula von der Leyen – to jeers from UK MEPs – used her acceptance speech to say the bloc would back a further Brexit extension beyond October 31st “should more time be required”. In the House of Commons, MPs passed a backbench amendment to try to block any attempt by a future government to suspend parliament to force through a no-deal Brexit in what was seen as a pre-emptive strike against Johnson’s authority. Figures from the Central Statistics Office this week showed the value of Irish good exports to Britain rose by nearly 10 per cent, or €486 million, to more than €6 billion in the first five months of this year. Investec's Gearóid Keegan this week raised the prospect that sterling could move to parity with the euro "and possibly beyond" in the event of a "messy" no-deal Brexit. The weakness in sterling is of particular concern to Ireland and its exporters. A no-deal Brexit, it said, could more than double its budget deficit next year, and add £30 billion a year to public borrowing. Then there was a report from the UK’s public finances watchdog which warned that Britain might be entering a full-blown recession. Separately, figures showed London home prices fell in May at their sharpest annual rate since 2009.
On the back of that hardened tone sterling fell to its lowest level against the dollar in more than two years and against the euro in six months. With the race for 10 Downing St nearing an end, both Johnson and foreign secretary Jeremy Hunt ramped up the rhetoric, both men declaring that the backstop must be removed entirely from the withdrawal agreement before it could be accepted.
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