France has signalled it is ready to cut a close post-Brexit EU deal with the UK, according to reports.

French President Emmanuel Macron aims to use an EU summit next month in Salzburg, Austria, to push for a new "alliance" between the EU and Britain, The Times newspaper has reported.

A new continental structure would see "concentric circles" with the EU and Euro at its core and the UK in a second ring, according to the newspaper.

The claims emerged after the EU's chief negotiator Michel Barnier struck an optimistic tone, stating: "We are prepared to offer Britain a partnership such as there never has been with any other third country."

The comments helped trigger a sharp rise for sterling on the money markets.

Mr Macron fears a no-deal Brexit will damage Europe, according to The Times.

The newspaper quoted a diplomatic source saying: "He sees a no-deal scenario as something that would break links and poison relations at a time when Europe needs to be united beyond the EU."

As the deadline to Brexit approaches, the UK is intensifying its withdrawal agenda with Foreign Secretary Jeremy Hunt at an EU meeting in Austria today.

Brexit Secretary Dominic Raab is also due to hold talks in Brussels tomorrow with Mr Barnier.

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Mr Raab moved to present an upbeat message to a British House of Lords committee this week stating that he was "confident that a deal is within our sights".

However, the Brexit Secretary indicated negotiations could go beyond the expected October deadline, stating: "I think it is important as we enter the final phase of the negotiations in the lead up to the October council and the possibility that it may creep beyond that, we want to see some renewed energy.

"We're bringing the ambition and the substance of our white paper on the future relationship and also I think some pragmatism to try and go the extra mile to get the deal that I think is in both sides' interests.

"We need that to be matched obviously, it's a negotiation," he said.