Brexit Bulletin: Merkel Moves On

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The EU is moving on from Brexit. That was the message from the leaders of Germany, France and Italy yesterday evening as they met aboard an Italian aircraft-carrier.

“We respect Britain’s decision but naturally also want to make it clear that the other 27 are working for a prosperous, safe Europe,” said German Chancellor Angela Merkel. “We need results.”

With future relations between the EU and the U.K. in limbo for now, continental leaders are trying to move toward an initial vision of the post-Brexit bloc for a summit of all 28 EU countries except Britain next month. Merkel will talk to another 13 leaders between Wednesday and Saturday before in-depth talks in Bratislava on Sept. 16.

“Many thought Europe was finished after Brexit—it wasn’t,” Italian Prime Minister Matteo Renzi said. “We think that Europe can be a solution to problems, while populists think that Europe is the cause of all problems.”

The press conference at sea followed the military theme introduced by Czech Prime Minister Bohuslav Sobotka, who said the EU will need a “common European army” in the long term to bolster security as NATO-member Britain abandons the bloc.

Another Lawsuit

Another legal challenge to Brexit was filed on Friday, this time from members of the Northern Ireland Assembly, who want a judicial review of the U.K.’s plan to leave. 

This claim is different to the others, according to the lawyers, as it deals with the “unique requirements of Northern Ireland constitutional law and statute,” Bloomberg’s Patrick Gower reports.  

Here’s our story from early August on the risks posed by the first batch of legal claims, which aim to force the government to consult Parliament before triggering the formal exit process. 

The government didn’t comment on the latest case. But Prime Minister Theresa May said last month—when she used her first official trip as premier to go to Scotland—that she wouldn’t start formal exit talks until she had established a “U.K. approach and objectives for negotiations.” Like Scotland, Northern Ireland mostly voted to remain, and if Brexit leads to a hard border between the U.K. and Europe, that frontier would run between Northern Ireland and the Republic of Ireland.

How Factories are Faring

Data today from the CBI will give an insight into how manufacturing orders are holding up after Brexit. Economists expect a decline in the data, which covers August.  

Persimmon, the U.K. homebuilder, said demand has held up since the Brexit vote. In an interview with Bloomberg TV, CEO Jeff Fairburn said the company, which focuses on affordable  properties for first-time buyers, has seen no change in buyer behavior.

On the Markets

Overnight, oil extended its retreat from a seven-week high and Asian energy shares declined, while the dollar weakened versus major peers as traders weighed prospects for a U.S. interest-rate hike this year. 

And Finally...

Finns are about to get a tax cut and they have British euro-skeptics to thank for it. Faced with weak global growth and uncertainty created by Brexit, Finnish Prime Minister Juha Sipila is going to bring forward income tax cuts that weren’t due until after March 2017, writes Bloomberg’s Raine Tiessalo. 

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To contact the author of this story: Emma Ross-Thomas in London at erossthomas@bloomberg.net.

To contact the editor responsible for this story: Alyssa McDonald at amcdonald61@bloomberg.net, Andy Reinhardt