Talks are continuing again today between Michael Gove and John McDonnell in hopes the two parties can cobble together a deal so Brexit can happen in weeks
A SOFT Brexit deal with Labour could be on the cards in the next "couple of months", Philip Hammond has said.
The Chancellor raised hopes that a Brexit deal could be thrashed out between the Tories and Labour to finally break the Brexit impasse as talks continued again this afternoon.
Talks went on between Michael Gove and John McDonnell in hopes the two parties can cobble together an agreement to push through the Commons.
And Mr Hammond said this lunchtime: "I think we are in with a good chance of being able to reach an agreement on the way forward in the next few weeks...
"I remain optimistic that over the next couple of months we will get a deal done."
Mr McDonnell told the media on the way out of talks this afternoon: "We are hopeful, positive.
"There's a fair amount of detailed work that will go on over the next week to ten days, then we will see where we are at."
He said politicians would be working through the Easter recess to try and break the deadlock, and that a second referendum was "always on the table".
Theresa May and Jeremy Corbyn had a short chat in Parliament last night too, in a further sign that a deal could be on the way.
Yesterday both sides hinted at progress.
Mrs May said in PMQs at lunchtime there was "more agreement in relation to a customs union than is often given credit".
And Mr Corbyn welcomed indications from ministers "that they might be willing to move in the key areas" that have stopped Labour backing her deal in the past.
Labour wants a customs union with the bloc after we leave, but Mrs May has argued her deal already would have all the benefits of one - and the ability to strike trade deals around the world.
And the leftie boss is also under huge pressure from members and backbenchers to demand a second referendum as the price of the party's support - something he is thought not to want.
The PM's Brexit agreement has been rejected three times by MPs in the Commons, leading to complete deadlock and two extensions to Article 50.
Mrs May urged her MPs and Labour's to work together "in the national interest" to come to a compromise.
She appeared to be laying the ground for a deal when she said: "Reaching an agreement will not be easy, because to be successful, it will require both sides to make compromises.
"But however challenging it may be politically, I profoundly believe that in this unique situation where the House is deadlocked, it is incumbent on both front benches to seek to work together to deliver what the British people voted for.";
But the Tories are still furious with her for working with the Labour boss, and pivoting towards a soft Brexit.
Dozens of MPs have called for her to go - including Sir Bill Cash who demanded she resign to her face.
Despite securing a six month Brexit delay with Brussels earlier this week, the PM is still convinced she can push a deal through before the EU elections next month.
Britain would have no choice but to spend £100million fighting in them if there still wasn't a deal to leave.
Mrs May also floated another option of bringing forward the EU Withdrawal Bill itself and allowing MPs to vote on amendments to it as a way of pushing the legislation through Parliament.
A Labour Party Spokesperson said last night: "Jeremy Corbyn and Theresa May had a short meeting in Parliament this afternoon, following earlier discussions between officials.
"Both sides agreed to continue talks in an effort to make substantive progress towards finding a compromise plan."
The PM's spokesperson has said the talks will go on for as long as it's believed that a deal could be on the cards.
If talks collapse then Mrs May has said she will return to the Commons and give MPs more votes on what to do next.
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