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Deal or no deal?

Everybody should prepare for the UK to not get a deal in Brexit negotiations, Philipp Hildebrand, vice chairman of BlackRock told the FT Commodities Global Summit.

“Clearly what we’ve seen in the last couple of weeks is the Prime Minister is very prepared to end with no deal,” Mr Hildebrand said. “Under no circumstances does she want to be humiliated as I think she thinks Prime Minister Cameron was by coming back with some sort of deal that ends up being rejected by the British people.”

But the UK government could use tax cuts and state aid to lessen the impact, Mr Hildebrand, a former head of the Swiss central bank, added.

“State aid is impossible to use in the EU, we saw this when governments tried to inject capital into banks,” he said. “But once you leave you can use state aid freely and that’s a powerful instrument.”

However, no deal on Brexit will still be “very costly” for the City, he added.

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