joining us now is, ross thomas -- emma ross thomas.hought these people served at the pleasure of the prime minister. >> jeremy hunt went into her office. she planned to move him. he stood his ground and he came out in the same position. another minister, she refused and ended up quitting the government. the criticism that has emerged is that she is not a strongly her and that has implications for brexit of course. this year is going to be incredibly tricky when it comes to securing a transition deal. lots of squaring of circles and clever footwork and concessions from the ukip it -- from the u.k. david: how much of the problem is she seems to be trying to take one from column a and one from column b? >> she has maintained pretty much the brexit balance within her cabinet. it is more a question of the leadership of the prime minister. this has happened before in 2009. there was an attempted reshuffle that didn't quite work out because the prime minister didn't have the authority to pull it off. david: is it going to be finished today? >

emma ross thomas will tell us all about that in just a second.t decline in the u.s. tenured to the -- 10 year today. the german ten-year is unchanged at 50 a spac 58 basis points. the italian 10 year is up at 2%. weeks fallen for two after closing up 0.29% ungenerous second. on january 2. emma: carillion has filed for liquidation. the company has struggled with debt and the shares have fallen since july. it works on government projects ranging from hospitals to the high-speed rail lines. the feud between persian gulf monarchies has escalated. the uae sent fighter jets from koetter and intercepted two of its jetliners from flights to moderate. qatar denies it took place. qatar denies allegations that it supports terrorism. officials areeral investigating that false alarm about a missile attack. hawaiian residents were sent into a panic when the mobile alert set a ballistic missile was inbound and people should take shelter. hawaii's governor said a state employee pushed the wrong button. president trump told reporters he is the least racist person

the brexit editor emma ross thomas is here as well as stephen morris. nd. bluffing,ook at the bluffing, double bluffing, does it make us any wiser of what happens to the banks? emma: the banks from the very beginning have been making contingency plans and have led the pack in planning for the worst case scenario. they are not relying on maintaining passporting, so what barnier says is because of the red lines the u.k. set out the u.k. will be leaving the single market and therefore they cannot maintain the access they have got. view, a u.k. point of year ago they did not seem particularly fussed about financial services. what we are seeing now is the u.k. is relying a bit on the e.u. 27 being divided. it --r has set out as an an initial negotiation, but there can be no passporting. what the u.k. is hoping for is certain countries do want the u.k. to continue to be, as carney says, the banker of europe after brexit. francine: what does it mean for the banks? they are already taking their decision, so will it be quick for them to bring people back, or are

david: that's emma ross thomas in london.ing little weaker on the day in the midst of the stronger dollar. what is your take on what's happening with a cabinet reshuffle and sterling? it tells us something about the balance of power between the soft brexit camp led byard exit boris johnson, i think that mostly this is a function of sterling weakness that's a function of the dollar. i think we are neutral. we want to watch it break out of that range. alix: what is your estimation? is it a harder brexit after the shuffle or a softer brexit? marc: it will be pushing toward that hard brexit camp. the first quarter is the discussion is going to be about this transition. end ofleaves in the march 2019, but they will have a transition and that's what they've got to negotiate under whatever conditions of that transition. what is the uk's ability to negotiate third-party trade agreements? that all has to be worked out during this transition. that's before a new relationship can negotiate and start in march or april. david: putting mor