Mark Carney stressed it's a "relatively unlikely possibility, but it is a possibility"
The governor of the Bank of England has warned that the risk of a no-deal Brexit is "uncomfortably high".
Mark Carney made the comments during an interview on BBC, although stressed it is still a "relatively unlikely possibility".
He argued: "[No deal] is highly undesirable.
"It [would] mean disruption to trade as we know it, and as a consequence of that a disruption to the level of economic activity - higher prices - for a period of time."
Mr Carney added: "People will have things to worry about in a no-deal Brexit - which is still a relatively unlikely possibility, but it is a possibility.
"What we don't want to have is people worrying about their money in the bank, or whether or not they can get a loan from a bank."
His remarks come as British Prime Minister Theresa May prepares to meet with French President Emmanuel Macron in France, as part of her continuing talks with EU leaders over her Brexit proposals.
BBC reports that Mrs May has cut short her holiday for today's talks at Mr Macron's summer retreat.
The British Brexit secretary Dominic Raab has also been meeting with French officials this week.
I had a warm and constructive first meeting with French Europe Minister @NathalieLoiseau. We discussed the progress of negotiations with Michel Barnier, the proposals in our White Paper and our shared commitment to work closely together. pic.twitter.com/zTKb44d3li— Dominic Raab (@DominicRaab) August 2, 2018
Yesterday, the EU's chief Brexit negotiator Michel Barnier indicated that the bloc is "ready to improve the text of our proposal" on the Irish border.
While stressing his belief that a deal can be reached, he also warned the UK can "no longer be as close economically" to other member states as a result of its decision to leave the EU.