Britain's Secretary of State for Exiting the European Union Davis and EU's chief Brexit negotiator Barnier are seen ahead of a meeting in Brussels
By Gabriela Baczynska
BRUSSELS (Reuters) - EU Brexit negotiators summoned national envoys and journalists at short notice on Monday as speculation mounted among diplomats of an interim deal to grant Britain a transition -- though some urged caution.
"There could be a deal," one senior EU diplomat said. Another, however, played down talk that good progress in negotiations with Britain over the weekend had covered enough ground to assure London of a transition deal after Brexit.
A major sticking point is Britain's reluctance to agree to terms on the Irish border set out in a separate part of the draft withdrawal treaty currently under discussion.
Britain has been hoping for an interim accord on the transition to ease fears among businesses before Prime Minister Theresa May meets fellow EU leaders at a summit in Brussels on Thursday. The following day, the other leaders are expected to agree terms for talks on future trade relations and May hopes that they will also endorse the interim accord on transition.
Member states' representatives in Brussels were summoned to an urgent meeting by the bloc's Brexit negotiators on Monday, diplomats and officials said. It was convening shortly before British Brexit Secretary David Davis was due to arrive about 11 a.m. (1000 GMT) to meet EU chief negotiator Michel Barnier.
The European Commission scheduled a news conference on Brexit for 12:45 p.m. Officials did not immediately confirm that it would be given by Davis and Barnier. They have typically spoken together after rounds of negotiation have concluded.
Their teams negotiated into the night on Saturday and Sunday to clear outstanding issues and -- London hopes -- secure a status-quo adaptation period of about two years after Brexit, which is due in March 2019.
Several EU officials and diplomats said the intense weekend talks aimed, among other things, at resolving serious differences over the Irish border had made good progress.
But one senior EU source involved in discussions said talk of a deal being agreed already was "hype".
Spokesmen for Barnier and the British government declined official comment.
The transition period is crucial for businesses and sterling has weakened several times in recent weeks as Barnier warned that negotiations were slow and the transition was not a given.
But talks have intensified since and the EU has said Britain was giving ground to ensure the transition agreement. Differences over how to avoid border checks on the island of Ireland have emerged as the key remaining obstacle.
The EU says a border between the Republic of Ireland and the British province of Northern Ireland would be unavoidable since London has said it will also be leaving the bloc's single market and customs union.
But both sides are determined to avoid erecting border checks again, fearing it could reignite violence the island experienced for decades.
Britain says the Irish settlement should only be decided as part of a future agreement between Britain and the bloc on their new relations following Brexit and the end of the transition period.
London has proposed using top-notch technology to make the checks seamless but the EU dismisses that as unrealistic.
(Reporting by Gabriela Baczynska and Alastair Macdonald in Brussels and Elizabeth Piper in London; Writing by Alastair Macdonald; Editing by Catherine Evans)