• Philip Hammond has used a speech in Germany to push for a Brexit that prioritises “economic logic”, arguing that any deal must ensure frictionless trade in goods and services and saying a transitional arrangement will be vital. Reiterating warnings about a possible “cliff edge” of tariffs, Hammond urged the government to negotiate an early transitional arrangement. Referring to last year’s referendum result, the chancellor also cautioned against over-interpreting the message on immigration: “They voted to regain control of our borders, not to shut down the flow of people that are the lifeblood of our economy, but to be able to manage it.” (Guardian)
  • David Davis has said that elements of his job make landing on the moon look simple. He made the remark to business leaders as he discussed the interim arrangements that will be in place after the UK leaves. He suggested the UK would no longer be in the EU’s customs union and single market during this period. Mr Davis, who said the timescale for any transition period was likely to end in 2022, said preparing for Brexit involved “loads of preparation for various outcomes”. (BBC)
  • Nicola Sturgeon has pulled back from an early second referendum to secure Scottish independence, after the SNP’s election setback. The Scottish First Minister announced she would “reset the plan we set out on 13 March” – which promised legislation at Holyrood to try to force the referendum. The move backfired in this month’s general election, when her Scottish National Party lost 21 of its 56 seats, falling to 35 per cent of the vote. With recent polling suggesting just 43 per cent of Scots favour a second independence referendum so quickly, Ms Sturgeon admitted the controversy had cost her party at the ballot box. (Independent)
  • Business groups have responded with frustration to the government’s proposals on EU citizens’ rights post-Brexit, which they said lacked the clarity employers needed and would lead to a big increase in the administrative burden on companies and individuals. “The announcement — which ranges from [the] government ‘wanting to’ to ‘intending to’ — will do nothing to ease the uncertainty of EU nationals and their employers,” said Tim Thomas, director of employment and skills at the EEF, which represents manufacturers. Mr Thomas echoed other business groups’ concerns that the proposals would lead to a new administrative burden both on employers and workers. (FT)