Sign up here to receive the daily news briefing in your inbox every morning with exclusive insight from the BrexitCentral team Pound hits $1.40 for the first time since Brexit vote… Sterling has extended its rally against the dollar to rise above $1.40 for the first time since the Brexit vote. Analysts said the pound’s recovery was helped by falls in the dollar and a rethink by some investors about the UK’s economic prospects. Others said that despite little development in the Brexit talks this month, there was some optimism about the UK’s chances of securing a deal. The pound rose by 0.3% to $1.4030 on Tuesday afternoon before easing back.- BBC. Why the pound is edging back towards pre Brexit level – Telegraph (£) …as manufacturing output rises again after firms work flat out Manufacturing output bounced back from a dip in the last quarter, according to a closely followed survey. The industrial trends survey by the Confederation of British Industry (CBI) showed overall output rising, with a balance of 21 per cent of firms reporting an increase for the quarter to January. The rise was driven by stronger domestic demand, which hit its strongest since June 2014, while exporters continued to enjoy the relative weakness of sterling as orders hit their highest since 2011. – City A.M. Boris Johnson rebuked over NHS post-Brexit cash plea Theresa May has called for discussions about future NHS funding to remain private after Boris Johnson publicly called for more money after Brexit. Before Tuesday’s cabinet meeting, it was widely reported that the foreign secretary would pitch for a £100m a week “Brexit dividend” for the NHS.The BBC understands he did not end up mentioning “specific figures”.No 10 said Mrs May chaired a discussion on post-Brexit funding options but made clear conversations should be private. – BBC News Boris Johnson felt the anger of his boss and his colleagues today, for making known his plan for Cabinet before the supposedly confidential meeting. His critics are frothing. One former minister even called for his sacking, others are publicly questioning his motivation. But if his ambition was to put the issue on the table, well, job done. The foreign secretary has tried to put himself on the side of the patient and the public when many are worried about the health service. In part, he is keen to preserve at least part of the promise he and others made during the referendum, and also to inject some vigour into a government that some on its own side see as moribund. – Laura Kuenssberg for the BBC Boris Johnson ‘humiliated’ in cabinet meeting – The Times (£) Is Boris preparing to flounce out of the cabinet? – Robert Peston for the Spectator Boris’s NHS gambit is good for his political health – Sam Coates for the Times (£) Boris Johnson promises liberal Brexit vision after mauling at cabinet – Matt Chorley for the Times (£) May would be foolish to ignore the frustration he is seeking to express – Times editorial (£) Budget deficit falls as Britain gets its money back from EU The chancellor appears to be on track to meet his borrowing targets after the national budget deficit narrowed by much more than expected in December, helped by an unusually large rebate from the European Union. The deficit in December was £2.6 billion, compared with £5.1 billion in December 2016. This was significantly below analysts’ expectations of £5 billion and was the smallest December borrowing figure since 2000 …The ONS said that the improvement in public finances in December had been boosted by a £1.2 billion credit from the EU. This reflects an agreement made recently between member states to reduce the size of the 2017 EU budget. – The Times (£) Guy Verhofstadt claims UK will not be able to fully take back control of its borders until 2021… Guy Verhofstadt, the European Parliament’s Brexit coordinator, today insisted that Britain will not be able to take back control of its borders until 2021 at the earliest. Mr Verhofstadt warned there could be no limits on the free movement of EU citizens into Britain during the proposed transition period, meaning an extra two years of unlimited EU immigration. Warning that the transition period would not allow “cherry-picking”, Mr Verhofstadt said any changes to immigration rules “would only apply after the Withdrawal Agreement and the transition period. – Telegraph (£) No new residency rules for EU migrants in the UK on Brexit day, says Brussels – The Sun …as May faces backlash over claim UK has ‘agreed in principle’ to Norway-style transition Conservative MPs have told Theresa May Britain must not be bound by EU rules during the Brexit transition period, after it was claimed in Brussels that the UK had already “agreed in principle” to a Norway-style deal. One warned it would be seen as a “failure” if the UK had to accept EU regulation and the European Court of Justice’s jurisdiction in the transition. Leading figures on the right of the party spoke out after The Independent reported comments from a senior European parliamentarian who said British officials had not objected to the arrangement in meetings. – Independent Brexit City finance papers sparks row in Lords The government must make its negotiating position on financial services clear to avoid triggering a potential Brexodus of firms, an influential member of the Lords has warned. Baroness Falkner grilled minister Baroness Goldie over the government’s apparent decision to shelve the long expected position paper on financial services, with Goldie insisting ministers could not show their hand during “very sensitive and delicate” negotiations. She was backed by various Conservative peers, including former chancellor Lord Lamont, who said it was “utterly absurd” to expect the government to comment on where negotiations would end. – City A.M. France seeks to lure London bankers and their families with offer of French lessons France is to offer language lessons to London-based bankers and their families in its latest ploy to lure business from the UK capital to Paris after Brexit. Paris will beef up bilingual schools for children of “impatriates” when they arrive as well as opening a special English-speaking hotline to help them navigate the confusing French education system. In another move to tempt financial sector workers to cross the Channel when Britain leaves the European Union, the French government has pledged to temporarily exempt foreign executives from paying into state pension schemes. – Telegraph (£) Did Jeremy Heywood have permission to defend Remain ally Olly Robbins? Worth watching Nick Watt’s profile of Theresa May’s Brexit supremo Olly Robbins, which draws on Guido’s story about his communist past and reveals David Davis regularly mocks his former Soviet sympathies. The film also carried a rare public statement from Cabinet Secretary Jeremy Heywood defending his Remain ally: “The civil service is putting enormous effort and many of its very best people into making a success of the project. It is being tested on a daily basis and I am very proud of what we have – so far – delivered. Morale is at record-levels, proving once again that the civil service is at its very best when under pressure.” – Guido Fawkes Liam Fox: 90% of growth will be outside the EU, and Brexit means Britain can benefit In little over a year the UK will have left the European Union and will be one step closer to using its restored independence to define a new role in the world. At the same time, the threat of protectionism around the world has never been greater. For the first time in decades, the established order of free, fair and open commerce is under threat, as we see more barriers to business going up, including by G7 and G20 countries, turning their backs on the principles that made them rich and powerful. This is not the time to pull up the drawbridge. – Liam Fox MP for The Times (£) Ruth Lea: Project Fear was groundless: the UK economy has been remarkably resilient Former Commercial Secretary to the Treasury Lord O’Neill has recently conceded that the UK economy has been more robust than he had expected, given the Brexit vote. He has been quoted as saying, “I certainly wouldn’t have thought the UK economy would be as robust as it currently seems”, reportedly attributing the resilience to better-than-predicted global growth. Of course, I welcome his honesty, but I do question whether the “better-than-predicted” world growth has had as much effect on the UK economy as O’Neill implies. – Ruth Lea for LSE blog John Redwood: The Treaty of Sandhurst Last week the government concluded a new Treaty with France, called the “treaty concerning the reinforcement of co-operation for the co-ordinated management of our shared border”. I have called it the Sandhurst treaty, in honour of the place where it was solemnized. Parliament has recently submitted the EU Withdrawal Bill to intensive scrutiny. Hundreds of amendments have been debated, 45 votes taken on the ones most favoured by the Bill’s opponents, and 12 days of lengthy discussion on a Bill whose main purpose is to ensure continuity of law once we leave the EU in accordance with the instructions of the voters. – John Redwood’s Diary Tim Worstall: Britain should scrap farming subsidies after Brexit The uncertainty that surrounds agricultural subsidies after Brexit is apparently hurting land prices. According to property consultancy Carter Jonas, the value in British farmland fell by more than 8 per cent last year. Michael Gove, the Environment Secretary, has pledged to continue EU-level subsidies until 2022. What happens after that remains unclear. But this warning of the consequences of ditching government support for farmers unintentionally makes clear why, in a sensible world, they’d have no such support. Lowering the cost of agricultural land would be a good thing. – Tim Worstall for CapX Brexit comment in brief As we leave the EU, there are plenty of friends willing to help us – Rupert Matthews for the Telegraph (£) Can the House of Lords stop Brexit? – Meg Russell for Reaction No Brexit deal is still better than a bad Brexit deal – John Redwood MP for The Commentator What the government’s fake news unit tell us about the Brexit negotiations – Katy Balls for the Spectator We need to stop listening to big business about Brexit – The Sun editorial Brexit is about leaving EU institutions behind, not cooling off on the bloc as a market – Claudia Catelin for The Times (£) Brexit news in brief EU will reveal detailed “political declaration” for post-Brexit trade by mid-March – City A.M. The great ECB reshuffle is on – Politico I could walk away and hold new election, Merkel warns – The Times (£) Europe’s eastern tigers roar ahead – Politico UK opposes strong EU recycling targets despite plastics pledge – Guardian EU could veto Britain’s post-Brexit free trade deal gloats Barnier – Express New Zealand prime minister Jacinda Ardern to visit London – The Times (£)