UK PM May's Conservatives still working on deal with DUP

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The small Northern Irish Democratic Unionist Party could agree a deal this week to prop up British Prime Minister Theresa May's Conservative party after it lost its parliamentary majority in a snap election earlier this month, a DUP source said on Tuesday.

"I am very reassured by what the prime minister said to me today that that won't be the case".

Number 10 is confident that the DUP will eventually back Mrs May, but a deal remains elusive.

"Talks are ongoing with the DUP and we continue to work towards a confidence and supply arrangement", the source said, adding that the parties had shared objectives on issues like Brexit, fighting terrorism and spreading prosperity.

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The intervention comes after Brexit Secretary David Davis was seen to have been dealt a blow in the opening day of withdrawal negotiations with the European Union, after it was agreed trade deal talks would not begin until October at the earliest.

The parties have until 29 June to reach agreement and have been warned that if they cannot, direct rule could follow. Mr Davis had been hoping for parallel trade discussions alongside negotiations on the divorce settlement with the EU.

The anticipated arrangement has forced the United Kingdom government to reject suggestions its commitment to act with impartiality in Northern Ireland - as set out in the 1998 Good Friday Agreement - will be fatally undermined by any pact with the DUP.

Speaking after her party's meeting with the new taoiseach, Sinn Féin's northern leader, Michelle O'Neill, said the party was "committed to making the institutions work". "It's not clear what her mandate is, and she has lost authority overseas".