"We expect the UK's disinflation story will take another twist on its (eventual) way down to target. The good news is that CPI is still expected to slide down in the coming months. The bad news? Higher energy prices appear poised to lift CPI meaningfully over summer, adding yet another hump in the inflation profile."
"Under our updated assumptions, we now anticipate a much sharper rise in petrol prices, while higher wholesale gas prices cause a 19% increase in the Ofgem energy price cap in July."
UK inflation is expected to hold steady at 3%, with some analysts predicting a slight decline. However, rising energy prices and ongoing Middle East conflict could increase costs. The Bank of England now anticipates inflation to remain around 3% through mid-2026, delaying the return to the 2% target. Economists express concern over unpredictability, with potential for inflation to exceed 4% later this year due to higher fuel prices and a significant rise in the energy price cap.
Read at London Business News | Londonlovesbusiness.com
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