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Clothing prices may rise in UK post Brexit

The cost of clothing in the UK could rise post Brexit. Shoppers have already seen clothing prices increase by 0.1 per cent in September 2016 as the falling value of the sterling makes imports more expensive. Many UK fashion chains import yarn and some manmade materials from abroad, making them vulnerable to currency fluctuations. If they import from China or India, the cost of yarn and raw materials are US dollar denominated. That impacts the cost. Aside from rising costs, there is the potential impact on tariffs from a hard Brexit.

If the UK does not reach a post-Brexit trade agreement with the EU by 2019, the nation could be forced to use World Trade Organisation rules. This would mean tariffs on food and clothing rising sharply, with clothing and footwear prices going up by 16 per cent. Brexit could also affect consumer behavior.

Critical to the UK is immigration. The country’s success is dependent on immigration. It may be necessary to manage the amount of immigration but a ban on immigration could be disastrous. Trade relationships will have to be maintained and new trade relationships have to be found. Continued single market membership would be helpful.