Reduction in Trade Between UK and EU Would Lead to Higher Prices

A reduction in trade between Britain and the European Union would harm both economies and causes prices to rise, Bank of England Deputy Governor Ben Broadbent said on Tuesday, without addressing the outlook for interest rates.

In a speech that focused on the benefits of globalisation, Broadbent warned that less trade with the EU would damage Britain’s comparative advantage in exports of financial and business services.

At the same time, Britain would end up having to produce more of the things it currently imports from the EU and is less good at creating.

Reuters

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Craig Erlam

Craig Erlam

Senior Market Analyst - UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam