Not even the strongest Brexit backer is likely to deny that when Britain departs from the EU, there will be a price to pay. Is Britain willing to pay it? Cash is one thing, but the so-called divorce could also have a substantial impact on something very dear to the British people: Breakfast.
According to analysis from KPMG, the price of a fry-up, the classic English breakfast, could increase by nearly 13%. What does fry-up includes? Usually baked beans, bacon, mushrooms and sausages, as well as orange juice. Not quite the avocado toast millennials are known to gobble up. Under WTO rules, once Britain leaves the union, tariffs would increase the cost of imports of many breakfast items, assuming the country will not land a suitable free trade arrangement.
Want some examples? Just take a look at oil, which is certainly an essential ingredient in the British feast. Both olive oil and orange juice are imported from Spain and Italy, and according to estimations, their price could see a hike of as much as 34%.
Last year, before the Brexit talks were on their way, we pointed out the possible risk a Britain exit could bring to some of Britain’s favorite foods including Stilton cheese and pork pies. Now, it seems that the impact could be much greater.
We’re not just talking about food of course. In Britain, the impact of the Brexit are already being felt as the pound’s decrease leads to increased costs of all imports. Furthermore, wage growth struggles to keep up with inflation.
PM Theresa May, now somewhat weaker after the election, has until March 2019 to secure a deal with the EU. So far, things are not going very smoothly. Michel Barnier, the EU’s chief negotiator, stated that a “frictionless” trade relationship between Britain and the EU is not a possibility.
What will be the final cost of the Brexit and will Britain strike a deal with the union or go for a potentially devastating “hard Brexit”? Stay informed and take advantage of market volatility.