Toyota and BMW warn no-deal Brexit could affect UK investment: Toyota and BMW have both warned that a no-deal Brexit may affect the production of their cars in the UK. BMW said that it would consider moving production of its Mini from the UK in a no-deal scenario. Separately, the head of Toyota’s European operations said that a negative outcome could put future investment at its UK factory near Derby at risk. Johan van Zyl told the BBC that if the Brexit “hurdles” are too high it would undermine Toyota’s competitiveness. BMW board member Peter Schwarzenbauer said if a “worst case” no-deal scenario happened, “we would need to consider what it exactly means for us in the long run”. (BBC News)

‘Positive signals’ coming from Brussels, says Jeremy Hunt: Jeremy Hunt, the UK foreign secretary, has said the UK is prepared to be flexible over how to address concerns about the Northern Ireland backstop in an effort to reach an agreement with the EU. Hunt told the BBC Radio 4 Today programme: “The signals we are getting are reasonably positive. I don’t want to overstate them because I still think there’s a lot of work to do but I think they do understand that we are being sincere”. “They are beginning to realise that we can get a majority in parliament because they are seeing the signals coming from the people who voted against the deal before who are saying, crucially, that they are prepared to be reasonable about how we get to that position that we can’t legally be trapped in the backstop.” (The Guardian)

Chief whip hands Tory Eurosceptics ultimatum on Brexit deal: Julian Smith, the government chief whip, has told the cabinet that if Mrs May is defeated in the second meaningful vote on 12 March, then Europhile MPs would insist on a delay to Britain’s departure from the EU and force Mrs May to adopt a new, soft Brexit strategy. Mr Smith’s comments are seen as a direct challenge to Brexiters to vote for Theresa May’s Brexit deal or face Europhile Conservative and Labour MPs working together to ensure Britain remains in a customs union with the EU. (FT)

Weaker sales for UK retailers due to Brexit uncertainty: Britain’s retailers experienced weaker sales last month as Brexit uncertainty led to consumers becoming more wary of making bigger purchases. The British Retail Consortium (BRC) and accountancy firm KPMG said that total sales growth dropped to 0.5% in the year to February, down from 1.6% a year earlier. (The Guardian)

UK services employment falls at fastest pace in 7 years: Employment in Britain’s services sector declined at the fastest pace for seven years during February as Brexit uncertainty and declining confidence led companies to hold back on hiring replacements for departing staff, according to a survey of executives working in the sector. The IHS Markit purchasing managers’ index for the UK’s dominant services sector rose to 51.3 during the month, up from a two-and-a-half year low of 50.1 in January. This was above market expectations of a fall to 50. The pound rose slightly after the UK service numbers were released. (FT)

BoE sets up Euro facility to buffer banks in event of disorderly Brexit: The Bank of England and European Central Bank are setting up weekly auctions of Euros to ensure banks do not run short of cash in the “significant market volatility” expected in a disorderly Brexit. The new liquidity facility announced on Tuesday is a “further prudent precaution” to ensure financial markets can function smoothly in the months spanning the UK’s departure from the EU, according to the BoE. The BoE maintains the UK’s financial system is strong enough to withstand the worst consequences of Britain leaving the EU without a deal, with banks holding large buffers of capital that would allow them to survive for months even if they were completely locked out from funding markets. However, the BoE’s Financial Policy Committee has issued a stark warning of the market turbulence that would be likely if the UK leaves the EU next month without a deal. (FT)

Department for International Trade cancels Brexit briefings with business: The UK’s Department for International Trade has cancelled its regular meetings with business after details of a previous roundtable were released to the media. The Liberal Democrats said that the decision by the department to suspend its roundtables with business meant the government was wrongly leaving companies “in the dark”. The department told business last month that the government could not guarantee the UK would be covered by “most” of the EU’s global network of trade agreements after Brexit, even if parliament approved Theresa May’s deal with Brussels. The department told business that while agreements with Switzerland, Israel and some African nations would be finalised by the UK by its scheduled EU departure date of 29 March, there was no certainty other deals could be rolled over or duplicated in time. (FT)

Northern Ireland warned of “grave” impact of a no-deal Brexit in letter from regional civil service head: Northern Ireland faces “grave” consequences from a no-deal Brexit, including a “sharp increase in unemployment”, a reduced choice of fresh food and the risk of social unrest, the head of the region’s civil service has concluded in a letter to the region’s political parties. “The consequences of material business failure as a result of a ‘no-deal’ exit, combined with changes to everyday life and potential border frictions could well have a profound and long lasting impact on society,” Mr Sterling wrote. (FT)

UK government was warned that Brexit ferry contracts carried legal risk: The UK government was warned that awarding no-deal Brexit ferry contracts carried legal risks but considered the need to provide emergency transport outweighed them, Transport Secretary Chris Grayling has said. The government judged that any legal challenge wouldn’t be concluded until after the contract to provide ferry freight capacity had been delivered, Grayling said. Last Friday, the UK government settled out of court with Eurotunnel for £33 million. The Channel Tunnel operator had sued it, arguing the ferry contracts distorted competition and abused procurement law (see here). (MLex)

UK asks EU for citizens’ rights protection under no-deal Brexit: Britain is asking the EU for an agreement that would protect the rights of both sides’ citizens in the event of a no-deal Brexit. Brexit secretary Stephen Barclay made the request in a letter to Brussels’ chief negotiator, Michel Barnier. Mr Barclay and Attorney General Geoffrey Cox are preparing to head to Brussels for talks with Mr Barnier on receiving assurances that will be enough for MPs to pass a deal in parliament next week. (Sky News)