LONDON A clean break with the EU's single market is not inevitable, British Prime Minister Theresa May said on Monday, seeking to clarify comments that pushed down the pound on the possibility of a hard Brexit from the European Union.
She criticized British media for misinterpreting what she described as long-term position on EU talks but the pound failed to recover from a 10-week low and was down more than 1 percent to the dollar and 1.2 percent against the euro on the day.
May, under pressure to offer more detail on her strategy before launching divorce talks with the European Union, said on Sunday in her first televised interview of the year that Britain would not be able to keep "bits" of its membership.
Some commentators saw that as a sign she was heading for a hard Brexit, which business says would damage the economy by breaking links with the single market of 500 million consumers. May shot back that the media was using terms she did not accept.
"I'm tempted to say that the people who are getting it wrong are those who print things saying I'm talking about a hard Brexit, (that) it is absolutely inevitable there's a hard Brexit," she told the Charity Commission, a government department that regulates charities in England and Wales.
"I don't accept the terms hard and soft Brexit. What we're doing is (that we are) going to get an ambitious, good, best possible deal for the United Kingdom in terms of ... trading with and operating within the single European market."
May's frustration was clear. The former interior minister, who was appointed as prime minister shortly after Britain voted to leave the EU at a June referendum, is increasingly concerned that Brexit will define her time in power, sources say.
In her speech on Monday, she said she wanted her government to help to heal the divisions in Britain that were deepened by the EU vote, and ensure that "everyone has the chance to share in the wealth and opportunity on offer in Britain today".
She announced measures to boost support to those suffering from mental health problems and said she would do more on housing, education and schooling, but despite applause from the audience, two out of four questioners asked about Brexit.
May has repeatedly said she will not reveal her strategy before triggering Article 50 of the EU's Lisbon Treaty to start some of the most complicated negotiations since World War Two, but her reticence has spurred scrutiny of her every comment.
She has largely stuck to the script that she wants Britain to regain control over immigration, restore its sovereignty and also to get the best possible trading relations with the EU, but any comment that seems to stray is pored over for signs of how May sees Britain's future relationship with the EU.
Asked whether May had ruled out getting preferential access to the single market in her interview on Sunday, her spokeswoman said she had ruled nothing out or in.
On Monday, May again said she was ambitious before the talks with the EU, which are due to be launched before the end of March.
"But we mustn't think of this as sort of leaving the EU and trying to keep bits of membership, what bits of membership will we keep," she said.
"It's a new relationship, we'll be outside the EU, we will have a new relationship but I believe that can be a relationship which has a good trading deal at its heart."
(Additional reporting by William James and Kylie MacLellan; editing by Jeremy Gaunt)