After more than five years at the Bank of England, Mark Carney is used to the slings, arrows, assorted potshots and excitable headlines that come with the job.

And today, he has shown he’s capable of looking after himself as he fended off critics on the Treasury committee over the BoE’s analysis of the costs and opportunities of Brexit.

Having been accused of hysterical, excessively gloomy forecasts, Carney told MPs in no certain terms that the Bank had put its best minds on the case for more than two years. And it only released its analysis because parliament demanded it.

Carney insisted:

We had a core team of 20 senior economists working on this for a couple of years.

They drew in another 150 professionals from across the Bank. Plus two senior committees, the MPC and the FPC [the monetary and financial policy committees].

There’s no exam crisis. We didn’t just stay up all night and write a letter to the Treasury Committee. You asked for something that we had, and we brought it and we gave it to you.

Perhaps a pop at David Cameron’s reputation as an ‘essay crisis’ prime minister, who got Britain into its current bracing condition?

Carney did receive some support from MPs. Labour’s John Mann thanked him for his work, and labelled Conservative MP Jacob Rees-Mogg “contemptuous of parliament” for criticising the BoE so sharply last week.

Carney went to some pains to explain that Bank officials had examined a range of scenarios -- not just the worst-case disorderly Brexit which dominated the headlines after the analysis was released last week.

But he also laid out fresh reasons for people to worry.

According to the governor, food prices would surge by 10% if the pound were to slump by 25% (as might happen under a particularly disruptive Brexit).

He also warned that Britain’s border infrastructure isn’t prepared for a swift move to WTO trading rules.

At this point in time, the ports are not ready for a move to an administered-WTO relationship... where we move to a WTO relationship with customs checks on both sides of the border.

Deputy governor Sir Jon Cunliffe concurred, having visited the port of Dover himself to check the situation:

For 92% of the 4.5 million trucks through Dover every year, they just roll on and roll off....

The 8% who actually come from outside the EU, wait 30 to 60 minutes while customs officials check that they’ve got the right documentation.

That may be all for today.....

The Treasury committee seemed to accept Mark Carney’s defence of the Bank of England’s Brexit analysis.

But Carney’s predecessor does not!

Mervyn King, who led the BoE into and through the financial crisis, has criticised the BoE’s work.

Writing for Bloomberg, Lord King says he’s not convinced that the UK would plunge into a savage depression after a no-deal Brexit, or face endless disruption at the border.

It saddens me to see the Bank of England unnecessarily drawn into this project. The Bank’s latest worst-case scenario shows the cost of leaving without a deal exceeding 10 percent of GDP.

Two factors are responsible for the size of this effect: first, the assertion that productivity will fall because of lower trade; second, the assumption that disruption at borders — queues of lorries and interminable customs checks — will continue year after year. Neither is plausible.

King is even more savage about Theresa May’s Brexit deal, comparing it to the failure to challenge Hitler in the 1930s.

There have been three episodes in modern history when the British political class let down the rest of the country: in the 1930s, with appeasement; in the 1970s, when the British economy was the “sick man” of Europe and the government saw its role as managing decline; and now, in the turmoil that has followed the Brexit referendum.

In all three cases, the conventional wisdom of the day was wrong.

Charlie Elphicke, MP for Dover, asks about the UK’s preparation for a no-deal Brexit.

Q: Will there really be big queues at the ports, given Britain already trades with the rest of the world without disruption?

Carney explains that Dover is specialised for RoRo trade (where lorries roll on, and roll off).

Other ports such as Southampton haven’t got the infrastructure for RoRo. They operate LoLo instead - using cranes to lug containers on and off.

This distinction really matters, Carney says, adding that in the Bank’s view:

At this point in time, the ports are not ready for a move to an administered-WTO relationship... where we move to a WTO relationship with customs checks on both sides of the border.

The governor explains that the Bank has spoken to the ports and the private logistics companies directly, so it understands the issue.

And Carney also rubbishes the idea that Britain could simply not apply new customers standards for some time, until it’s ready. That doesn’t work, if other countries do apply standards promptly.

The truck that comes here has to come back. And the truck that comes back empty, or has to wait, isn’t going to come here in the first place.

And that’s something you learn after about 5 minutes when you start to have these conversations with logistics companies or the ports themselves.

Q: If there is a no-deal Brexit, will food prices go up? And if there is a deal, will food prices go up here, and in Europe, John Mann asks.

Mark Carney thanks Mann for his opening statement (blasting Jacob Rees-Mogg).

He says the Bank has provided a “mechanical assessment” of the tariff impact on food and beverages.

The net effect of that... all depends on the deal... but would increase the price of food in the country.

There will probably be a one-off impact, passed through quickly to the consumer.

Q: Talk like a human being, not an economist, Mann pleads. How much?...

“The price of food is going up”, Carney replies in his best human, adding.

If there is a 25% drop in the pound, the cost of your shopping basket rises by 10%.

But people will switch from more expensive items, to cheaper once.

Q: I’m not sure my constituents will all go vegan if meat prices go up, Mann replies.

True, but they might eat more home-grown lamb rather than, say, imported veal, says Carney.

He agrees that UK food could cost more in the EU, but that would be cushioned by a stronger currency vs the pound.

Deputy governor Ben Broadband chips in saying there are three reasons why UK food will be more expensive in a no-deal scenario.

• The pound will fall, pushing up import costs
  
• tariffs would be imposed on some food.
  
• increased costs at the borders, due to customs checks.
  

Labour MP John Mann now weighs in, and savages Conservative MP Jacob Rees-Mogg for his criticism of the governor last week.

Our democracy is fragile at the moment, says Mann. He reminds the room that the Treasury committee had unanimously asked the Bank to contribute to its work on Brexit.

What Rees-Mogg did was contemptuous of parliament, in suggesting that you weren’t being straightforward with this committee. Contemptuous. And that needs stating loudly....

I’d like to thank you for providing your advice, and being here today.

Mark Carney keeps very tight-lipped, but he seems to appreciate the point.

Reminder: Rees-Mogg last week slammed Carney as a “second-tier Canadian politician” who “failed” to get a job at home. He also claimed the governor had damaged the Bank’s reputation, by his repeated Brexit warnings.

Q: What about the idea that Britain could take the Norway model for Brexit, rather than Theresa May’s deal?

Deputy governor Jon Cunliffe says joining the EEA would be “quite uncomfortable” for the City.

Britain’s financial system is “20 times bigger than Norway, it’s much more complex.

Given how the EEA works... EU laws are adopted by EEA members, Cunliffe adds.

Mark Carney is also concerned that Britain’s financial system will suffer once UK policymakers are ‘outside the room’ where rules are made. Being a rule taker on financial services is ‘highly undesirable’, he tells the committee.

Committee chair Nicky Morgan MP says, with some understatement, that the Bank’s analysis of Brexit attracted “not entirely universal praise” last week

How would you respond to the criticism?

Carney says there have been two classes of criticism aimed at the Bank of England since it released its work last Wednesday evening.

The first - the fact of the publication - is “entirely unfair’, the governor insists. The Bank has a responsibility to the public, through parliament -- and the Treasury committee actually asked the Bank to produce its analysis.

Carney says he actually welcomes the second criticism, about the analysis itself.

He points out that the Bank drew up several scenarios -- a disruptive Brexit versus a disorderly one, and also modelling a smooth move to WTO. It’s not simply a blunt warning

Carney adds that the Bank has used relatively modest assumptions for the ‘elasticity’ of how the UK economy would respond to trade disruption.

This work is “well-grounded, we’ve disclosed the key assumptions”.

Parliament’s treasury committee has begun its hearing with the Bank of England.

Testifying, we have governor Mark Carney, and deputy governors Ben Broadbent, Sir Jon Cunliffe and Sam Woods. You can watch it live here.

The committee begins by asking about the Bank’s analysis of Brexit, and its warning that No-Deal could cause the worst recession in decades.

Q: What’s the difference between a scenario and a forecast?

Carney explains that a scenario shows “what could happen to the economy”, based on clearly laid out assumptions. The bank then applies “reaction functions for macro policy” -- basically working out what monetary policy moves it would make, and how they would affect things.

Q: What’s the probability of your worst-case Brexit scenario actually happening?

Tail risk is tail risk, it’s low probability, Carney replies. And MPs on the committee probably have a better idea about how Brexit will play out, he adds.

The Financial Times has an alarming story about the potential impact of a no-deal Brexit.

They’re reporting that the government is preparing to ration space on Britain’s ferries, because leaving the EU without a withdrawal agreement would mean disruptive new customs checks.

The FT says:

Chris Grayling, transport secretary, has warned the cabinet that trade on the key Dover-Calais route could be cut by up to 87 per cent in the event of a disorderly exit, as checks and customs controls are introduced in France.

The pro-Brexit Mr Grayling has written to colleagues seeking approval for the chartering of ships, or space on ships, to operate on alternative routes, bypassing likely blockages in the Strait of Dover.

He has also requested cabinet approval to increase the capacity at three ports with trade links with the EU but with considerably longer journey times: Ramsgate, Sheerness and Immingham.

One official has apparently warned that Britain would face Soviet-style empty shelves in the supermarkets, as perishable fruit and veg would rot before it made it through customs....

If this happened, the government would also find itself having to choose what to prioritise -- medicines, equipment or food.

One official has apparently joked that “It’s gearboxes versus pâté,”. And while one’s rather tastier on toast, we both know what carmakers such as Toyota needs.....

Theresa May’s Brexit deal has few supporters in Westminster, of course, and may be voted down next week.

But Toyota’s Tony Walker argues that the agreement is valuable, telling Radio 4 that:

“It allows trading to continue on the same terms as today until the end of the transition period and it gives us direction rather than further confusion for the long term.”

He said the industry needs three things for the long term:

“Trade which is frictionless at the border, and if we can develop proper automated systems we can achieve that.

We need common technical standards for cars and it’s talking about that deep and meaningful regulatory harmonisation and… it talks about zero tariffs in the deal which is excellent, it’s a huge progress for us, we need something on cumulation, so we can accumulate for rules of origin purposes. all those things look within reach.

If we go forward and negotiate and kick out now we are back to square one.”

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

There’s just 115 days until Brexit Day, and British businesses are getting jittery. The prospect of new customs checks at the border and delays at the ports is alarming CEOs, as they weigh up when to activate their no-deal plans (or furiously cobble one together).

The car industry is particularly worried, given its close links with suppliers across the channel.

And this morning Tony Walker, deputy managing director of Toyota in Europe, has backed Theresa’s May’s transitional deal with the EU.

Speaking on the Today programme this morning, Walker warned that crashing out of the EU without a deal on 29th March 2019 would caused “unimaginable” problems.

Production at its Derby car plant would be severely damaged, Walker explained, predicting:

“stop-start production for weeks, probably months. It would be hugely expensive and disruptive.”

Toyota sends 50 lorries per day through the Channel Tunnel, carrying vital parts. Not only do they all need to arrive, they need to get there in the right order. So any new friction at the border would be extremely serious, especially as Toyota only holds four hours worth of parts.

It’s also not practical to stockpile large amounts of parts in advance, Walker adds.

Walker will tell MPs on the business select committee about his concerns this morning, alongside Sydney Nash of the SMMT (Society of Motor Manufacturers and Traders), and Dermot Sterne of Welsh manufacturer Applied Component Technologies

And down the corridor, Mark Carney of the Bank of England will also be discussing Brexit. Last week the BoE warned that the economy could plunge into a deep recession if Britain leaves without a deal, with house prices tumbling and interest rates being hiked.

This warning saw the governor labelled a “failed second-tier Canadian politician”; surely MPs will manage some more mature analysis this morning.....

Also coming up today,

After yesterday’s rally, the markets will be choppier today. Relief over the US-China trade truce is being replaced by concerns that a permanent deal will be tough to reach.

The pound may come under pressure, as MPs debate whether the government would be in contempt of parliament for not releasing its Brexit legal advice. This potential bombshell will overshadow the start of the debate on Theresa May’s deal.

On the eurozone front, euro finance ministers have been up all night arguing about 2019 budget plans, and the push for closer monetary union.

The agenda

• 9.15am GMT: Treasury committee hearing on The UK’s economic relationship with the European Union, with the Bank of England
  
• 10am GMT: BEIS committee hearing on Leaving the EU: implications for UK business, with the car industry