The EU’s chief negotiator, Michel Barnier, feels the two sides can now discuss drafts of the legal text in secret. There will be an EU summit next week and the U.K. is scheduled to leave on Oct. 31.

Key developments:
Tusk sees optimistic signs after Thursday’s meeting between Johnson and Leo Varadkar
Brexit Secretary Steve Barclay met EU negotiator Michel Barnier in Brussels. EU diplomats due to be briefed on progress later
Pound surges; RBS and Lloyds shares jump
Speculation that Johnson offered Varadkar concessions on customs arrangements for Northern Ireland
Johnson Keeping Foster in Brexit Loop (12:30 p.m.)
Boris Johnson has spoken to Arlene Foster, leader of the Democratic Unionist Party, about his Brexit proposals, according to a U.K. official.

His office is keeping the DUP informed of the status of talks, aware that the party’s support for any deal could be crucial to it passing though The House of Commons.

Pound Optimism Continues as Banks Surge (11:55 a.m.)
The pound is now headed for its biggest two-day rally since before the Brexit vote in June 2016. The latest step higher came after a European Commission spokeswoman labeled the talks “constructive” (see 11:20 a.m.).

Its not just the currency where optimism is mounting. Shares in Royal Bank of Scotland Group Plc and Lloyds Banking Group Plc are up more than 9 %.

Barclay-Barnier Meeting ‘Constructive,’ EU Says (11:20 a.m.)
The European Commission was tight-lipped about the outcome of Friday morning’s meeting between EU chief Brexit negotiator Michel Barnier and U.K. Brexit Secretary Stephen Barclay, with a spokeswoman saying only that the talks were “constructive.”

“You can assume they exchanged ideas, discussed many different angles,” Mina Andreeva told reporters in Brussels. “If there’s a will then of course there’s a way, otherwise people wouldn’t be working on this.”

A U.K. spokesman used the same word to describe the talks.

Brexit Talks May Enter Tunnel, Varadkar Says (11 a.m.)
U.K. and EU negotiators may now enter the so-called tunnel for Brexit talks, Irish Prime Minister Leo Varadkar told reporters in Dublin.

The focus is now on Brussels, he said, adding that he expects the U.K. will make more detailed proposals. The less said publicly about the talks the better, he said.

DUP Lawmaker Warns on Stormont Veto (10.35 a.m.)
Removing the so-called Stormont lock from any Brexit deal would leave Northern Ireland’s unionists “marooned,” Democratic Unionist Party lawmaker Jim Wells warned in an RTE radio interview.

Northern Ireland Secretary Julian Smith’s suggestion that no one party in the region would have a veto through a vote in the Northern Ireland Assembly “does worry me,” Wells said, adding that “nothing will work unless unionism is signed up to it.”

Acknowledging there had been a change of mood in the talks after Varadkar and Johnson’s meeting on Thursday, Wells, who is a member of the suspended Assembly, made clear that any plan which would force Northern Ireland to follow EU rules would be “unacceptable.”

Pound Rises Again on Brexit Optimism (10:25 a.m.)
The pound has surged 2.5% since Wednesday’s close, with traders jumping on the signs of Brexit optimism.

It gained 0.6% to $1.2511 Friday, with Donald Tusk’s comments (see 10 a.m.) adding to the momentum. Deutsche Bank said Thursday evening it was no longer negative on the U.K. currency following a “pivotal moment” in Brexit talks.

Options show sentiment on the pound over the next month is now the most positive since Bloomberg began compiling the data in 2003.

Ireland: Detailed Talks Will Start (10:05 a.m.)
While Thursday’s meeting between Johnson and Varadkar was positive, the “real detailed negotiation and technical work now will begin and that will be in Brussels,” Irish Finance Minister Paschal Donohoe said.

Speaking on Newstalk radio, Donohoe pointed to the issue of allowing the region of Northern Ireland to give or withhold “consent” for any new customs system as a crucial area for discussion in the talks. There are differing views in the region on the issue, he said.

EU’s Tusk Says ‘Promising’ Signals for a Deal (10 a.m.)
EU Council President Donald Tusk gave some mixed messages over the chances of a Brexit deal, saying the U.K.’s proposals aren’t yet realistic but there are “promising signals.”

“Unfortunately we are still in a situation in which the U.K. has not come forward with a workable, realistic proposal,” Tusk said in a televised statement in Cyprus. “A week ago I told Prime Minister Johnson that if there was no such proposal by today I would announce publicly there are no more chances” of a deal at next week’s summit of EU leaders.

But Tusk said there was some positive news out of Thursday’s meeting between Johnson and Irish Prime Minister Leo Varadkar.

“I have received promising signals from the Taoiseach that a deal is still possible,” he said. “Technical talks are taking place in Brussels as we speak. Of course there’s no guarantee of success and the time is practically up, but even the slightest chance must be used.”

AB InBev Shelves U.K. Expansion On Brexit Fears (9:40 a.m.)
Brewing giant Anheuser-Busch InBev SA put on hold plans to roughly double the size of its U.K. headquarters amid growing uncertainty over Brexit.

The Belgian owner of Budweiser and Corona had been in talks to lease additional space in London’s Bureau building, where it already occupies the top four floors, two people with knowledge of the matter said.

Read More: AB InBev Shelves U.K. Office Expansion Amid Brexit Worries

Fianna Fail Expects Talks to Resume (9.15 a.m.)
The leader of Ireland’s main opposition party expects U.K. and EU negotiators to resume formal Brexit talks after Irish PM Leo Varadkar and U.K. leader Boris Johnson met on Thursday.

Micheal Martin, who leads the Fianna Fail party, said he would be disappointed if talks don’t restart. “In good diplomacy there has to be accommodation and you can’t have one side losing face against the other,” he told RTE radio.

Martin’s party is in a confidence and supply arrangement with the government, so is consulted on most major government decisions. He is likely to have been briefed on Thursday’s meeting.

Barclay and Barnier Meet in Brussels (8:30 a.m.)
U.K. Brexit Secretary Steve Barclay has arrived at the European Commission in Brussels for talks with the EU’s chief negotiator, Michel Barnier. The two will explore where things stand after Thursday’s meeting between the prime ministers of the U.K. and Ireland and discuss whether to restart more intensive talks.

There’s no scheduled time for the meeting to end but Barnier is due to address EU ambassadors at 12:30 p.m. Brussels time.

Earlier:
Brexit Hopes Rise as U.K. and EU Take a Step Closer to a Deal
Boris Johnson’s Irish ’Pathway’ Is Full of Holes: Lionel Laurent
Imagine Brexit Heaven. It Isn’t Easy, I’ve Tried: John Authers

–With assistance from Tim Ross.

To contact the reporters on this story:
Ian Wishart in Brussels at [email protected];
Peter Flanagan in Dublin at [email protected];
Charlotte Ryan in London at [email protected]

To contact the editors responsible for this story:
Flavia Krause-Jackson at [email protected]
Thomas Penny, Raymond Colitt