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Week Ahead (23 November)

W/C Monday, 23 November - Brexit talks to continue as timeframe for ratification of deal narrows

Despite reports that last week's European Council meeting was considered the latest point at which a trade deal could be agreed, negotiations between the UK and EU continue. It was reported last week that the vast majority of a deal has been completed, but that disagreement remains on three long-debated matters; fisheries, governance and the level playing field. Question marks also remain over aspects of the deal concerning energy, road haulage, aviation and rules of origin. With 38 days remaining until the expiry of the transition period, time is now at a premium for ratification of a potential deal at European level.

European governments have called on the European Commission to move towards contingency planning for a no-deal scenario. Leaders of Belgium, France and the Netherlands said that time was running out and that member states could not "keep hoping for a good outcome".

Wednesday, 25 November - Rishi Sunak to outline spending review decisions

The UK Chancellor of the Exchequer, Rishi Sunak, will outline how the UK government intends to fund hospitals, schools and public services for the coming financial year. Speaking on Sunday, the Chancellor said that the UK economy is currently "experiencing significant stress" and that it would remain so for some time to come. Sunak said that his speech would not signal a return to austerity, but that the government would make "quite a significant" increase to spending on public services. The Chancellor also said that taxes would have to increase in the next year as the UK could not continue to borrow money indefinitely, despite current borrowing rates being low.

Thursday, 26 November - Minutes of ECB's October monetary policy meeting to be released

The minutes of European Central Bank's 28 - 29 October monetary policy meeting will be released on Thursday. At October's meeting, the governing council decided to keep headline lending rates unchanged. It also made no changes to its Pandemic Emergency Purchase Programme, worth €1.35 trillion and scheduled to last until June 2021. In its statement issued post-meeting, the governing council said that risks are "clearly tilted to the down-side", and that a "recalibration" of efforts to tackle the pandemic-induced economic crisis would be made once Eurosystem macroeconomic projections were available in December. The minutes should provide clues as to how the ECB will proceed at the December monetary policy meeting.

Friday, 27 November - Bundesbank's "Digital Future of Payments" conference to hear about digital euro

On Friday, the Bundesbank will host a conference on the "Digital Future of Payments". The virtual event will be attended by high-level speakers, including Olaf Scholz, Mairead McGuinness and Fabio Panetta, who will discuss the Retail Payments Strategy of the European Commission, the European Payments Initiative and the potential role of a digital euro in the payments landscape.

The ECB has begun to consult on the potential creation of a digital euro. It released a preliminary report in early October which found that the issuance of a digital currency would complement the use of cash, not replace it, and that the development of the digital euro would help to provide citizens with "access to a safe form of money in the fast-changing digital world".

Panetta is also likely to discuss plans for the regulation of stablecoins in Europe. The Financial Stability Board released a report recommending controls for large stablecoin operations in mid-October, with the aim of co-ordinating a global banking response to the emergence of crypto assets and digital currencies.

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