LONDON/BRUSSELS—Britain and the European Union are seeking a post-Brexit trade deal, with failure likely to result in increased chaos in mutual trade, financial markets tumbling, and huge economic costs. Here are some of the potential pressure points of a failure to reach agreement on trade. Sterling Investors and banks have long predicted a trade deal would be done, so a no-deal would hit the British pound, foreign exchange traders say. But investor sentiment was hit by the sides saying on Saturday that there was still no agreement covering annual trade worth nearly $1 trillion, and sterling has fallen against the U.S. dollar since then. The shock result of Britain’s referendum on leaving the EU in 2016 sent the pound down 8 percent against the dollar, its biggest one-day fall since the era of free-floating exchange rates began in the 1970s. Trade In the case of a “no deal” on trade, …
The Potential Impact of Brexit Without a Trade Deal
