Crypto News: Political rammies

Today the big political moves aren't happening in Westminster.

After two years with no government at Northern Ireland's Stormont, a deal is on the verge of being agreed and power-sharing is on the verge of being resurrected. And in Edinburgh, the Covid inquiry is inflicting possibly more damage on the SNP than its London run did on the Tories. This afternoon Nicola Sturgeon, on camera and fighting back tears, admitted deleting WhatsApp messages, further shoving her successor Humza Yousaf off the course of restoring their party's electoral health.

Westminster could almost take the day off.

As the Readout reaches you, the UK government has just announced a deal for improving post-Brexit trading rules that will allow the DUP to end its two-year boycott of Stormont. The party pulled out of the power-sharing arrangement when it decided Boris Johnson's deal had created an effective border in the Irish Sea. Today the UK government is said to have promised the DUP there will be no such checks.

Here's our reporters: "[Rishi Sunak] will be relieved because the political vacuum in Northern Ireland drew attention to the unfinished issues around Brexit. Yet it's not risk free — Brexiteers will be poring over the deal to ensure Sunak hasn't done anything that would limit what they regard as the UK's freedom to diverge from EU rules."

Sinn Fein's Michelle O'Neill looks likely to become the first nationalist First Minister of Northern Ireland. Unsurprisingly, her party is briefing that this would make a united Ireland more likely, with Sinn Fein leader Mary Lou McDonald telling reporters that "a new Ireland is emerging" and the "electoral majority for unionism has gone."

Mary Lou McDonald (left) and Michelle O'Neill in 2022 Photographer: Jeff J Mitchell/Getty Images Europe

But the opposing view is that if these trading arrangements are as they say, and give Northern Ireland access to both the continent and the rest of the UK, it may find it is perfectly happy to stay as is.

Up in Scotland, our reporters are at the Covid inquiry. If the Westminster one was salacious, this one is surely a rival for sheer "they said WHAT?"-ery.

There's simply too much to gasp at. Firstly, there was Liz Lloyd, Sturgeon's top adviser, describing herself as the former First Minister's "thought partner." Huh? Then the revelation Lloyd had wanted to use a Covid spat to engineer a political "rammy" with Westminster over furlough. But my personal favorite is one official admitting that deleting WhatsApp messages was his "pre-bed" ritual.

This must feel like shooting fish in a barrel for Labour, which is gunning to win back many of the seats lost to the SNP to get Keir Starmer into Number 10. Here's Bloomberg's Emily Ashton: "Current polling looks positive for Labour: a survey by Norstat for the Sunday Times on Jan. 25 — the first since the WhatsApp deletion row — had Labour surging to its biggest lead over the SNP for almost a decade."

Back in 2016, the health of the union had been expected to be a major casualty of Brexit. The implosion of the SNP makes that less obvious in Scotland, and in Northern Ireland a spruced-up trade deal could ease tensions there too.

Bloomberg is doing some research. Will UK living standards improve? You can share your views here.

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If the union feels less disunited, the UK's post-Brexit trade relations are still, to put it mildly, finding their feet. To mark the moment new border restrictions come into place between the UK and EU, Bloomberg's Lucy White shows those elusive free trade deals have proved, well, elusive.

"The prime minister had hoped for free trade agreements with the US, India and others to lift a stuttering UK economy," she writes. "But those have stalled over issues ranging from migration to meat imports. Discussions with Canada came to an abrupt halt last week."

Photographer: Geert Vanden Wijngaert/Bloomberg

As well as this, earlier this month Lucy wrote about how Britain's trade reliance on the EU has reached a 14-year high.

"Since the Brexit referendum, the global trading landscape has changed significantly," Raoul Ruparel, a former government adviser, told Lucy. "Focus is now much less on FTAs and more on industrial strategy and protecting supply chains. This means that many FTAs the UK hoped to have landed by now are taking much longer or are unlikely to happen at all."

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$1.30

Banks including Goldman see the pound rising to $1.30 in the expectation that the Bank of England will defer rate cuts.

One key story, every weekday

A dozen glistening storage tanks on a windswept island in the North Sea are one of the few visible signs of a costly experiment aimed at making a tiny fraction of Europe's industrial pollution disappear.

Part of a $2.6 billion network, the facility on Norway's Blomoyna is set to pump climate-warming carbon dioxide from manufacturing sites in the Netherlands and elsewhere into an untouched saline aquifer deep below the seabed. The first injections could start as early as next year and pave the way for a new international trade in industrial emissions.

That is if the pollutant can be neatly captured at smokestacks, legally shipped along an untested transit network and reliably stored at a significant scale. Those are big ifs, but desperation by Germany to support manufacturers is helping to fuel the momentum.

Allegra Stratton worked for Prime Minister Rishi Sunak when he was chancellor and runs an environmental consultancy, Zeroism.

Please send thoughts, tips and feedback to readout@bloomberg.net. You can follow Bloomberg UK on X.

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