Food prices could rise between five percent and ten percent if there is a disorderly Brexit, the Bank of England governor, Mark Carney, has warned. Mr Carney told lawmakers that in the most “extreme” case, prices would rise by ten percent, but in a less severe scenario the increase would be about six percent.
The price rises would come partly from a fall in the value of the pound, partly from any tariffs imposed and partly from increased costs at the border as imports are checked.
The Bank of England and its governor have attempted to assess the impact of Brexit on several occasions. All its assessments have seen it as a potential negative for the economy.
Mr Carney also said the UK’s ports were not ready for a no-deal Brexit that would see the country trade under World Trade Organization rules. Under WTO rules, tariffs would be applied to UK goods. The average WTO tariff varies from product to product, from zero percent on mineral fuels and pharmaceuticals, to about 20-35% on processed food and forty-five to fifty percent on meat.