The European Commission is reportedly moving to shut off five countries from its financial markets due to loopholes in the credit rating regulations of the nations in question. The U.K. should look closely, experts say.
The Financial Times dropped the bomb on Sunday but buzz around the report only started kicking off on Monday, as experts determine how big of an impact the situation will bring to the European Union (EU) and the soon-to-crash-out United Kingdom.
According to the FT report, the countries in question are as follows: Canada, Australia, Singapore, Brazil, and Argentina. While not all segments will be blocked by the EU, the impact will still be huge, industry experts say.
The EU reportedly discovered that the five countries on its watch list now have credit rating agency regulations that are no longer in line with the bloc's methods. The Commission has yet to officially confirm the report.
However, some experts believe the EU's new move may be a subtle warning to the U.K. The Brits are set to leave the bloc in September and multiple government officials hinted that it appears a no-deal Brexit is more likely now than ever.
Some analysts believe that since the British government is already operating as if it is crashing out of the EU without a trade agreement, the EU is warning the U.K. to make sure its laws are in harmony with the bloc.
Meanwhile, new British Prime Minister Boris Johnson said on Tuesday that he is looking at "every chance we can get a deal," BBC News reported. He noted, though, that former PM Theresa May's Brexit deal "had to go" at all costs.
Johnson went on to explain at the Faslane naval base that while his government will go "the extra thousand miles" to get a deal that will benefit his people, it is also his government's duty to prepare for a no-deal scenario if it happens.
The PM's hints about a potential no-deal Brexit appear to be more in line with his government's previous statements. Conservative MP Michael Gove wrote in The Times over the weekend that the government is ramping up work to walk out of the bloc without a deal.
"No deal is now a very real prospect, and we must make sure that we are ready," Gove wrote, igniting fears among economic and diplomatic experts who believe it is not the right path to take.
Analysts said that if Johnson was really determined to stop the U.K. from crashing out minus a deal, he would have to tweak May's proposal about the Irish backstop that has held back the EU from agreeing to the deal.
