"Sanjay Raja, the chief UK economist at Deutsche Bank, stated, 'The UK's disinflation story is set for another twist. The good news is that the CPI is expected to fall in the coming months. The bad news? Higher energy prices appear likely to significantly raise the CPI during the summer, creating yet another spike in the inflation trajectory.'"
"Edward Allenby, a senior economist at Oxford Economics, predicts an even sharper increase later in the year, with the CPI potentially exceeding 4% in the second half of 2026. He pointed to a 19% increase in the Ofgem energy price cap in July and higher petrol costs as key factors contributing to this rise."
UK families face rising living costs due to increasing energy prices linked to the US-Iran war. Economists predict the consumer price index (CPI) may rise above 3%. Deutsche Bank forecasts a CPI of 3% for February, while Oxford Economics anticipates a slight decline to 2.8%. Analysts warn that higher energy prices will delay inflation's return to the 2% target, with projections suggesting a CPI of around 3% in 2026. Continued spikes in gas prices could push inflation close to 4% by year-end.
Read at London Business News | Londonlovesbusiness.com
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