The United States must prepare for the very real possibility Britain will leave the European Union without an exit agreement, Treasury Secretary Steven Mnuchin told lawmakers on Tuesday.
"I think at this point we need to be prepared for a hard Brexit as a very realistic outcome," Mnuchin said during testimony to the House Committee on Financial Services.
He added that the US Treasury had coordinated with the Federal Reserve and other US banking regulators to be ready for such a scenario, as London and Brussels scramble to avoid a potentially chaotic "no deal."
Britain is currently due to exit the EU on Friday and as yet has no agreement in place to govern economic ties with the bloc afterwards. Economists say crashing out without a deal would be a seismic event.