UK Economic Outlook and Inflation Risks
As geopolitical tension intensifies, the UK economy is entering a more fragile phase shaped by higher energy costs, supply-chain disruption and persistent inflation pressure. This UK economic outlook assesses how the Iran conflict could delay disinflation, keep Bank of England rates higher for longer and tighten fiscal choices. While households are more resilient than during the 2022 to 2023 energy crisis, uneven consumer strength and rising freight and fuel costs continue to weigh on confidence and growth.
Consumer Pressure and Fiscal Trade-Offs
The report explores how imported inflation, weaker confidence and tighter fiscal headroom are reshaping decisions for businesses, lenders and policymakers. It examines the outlook for UK consumers, interest rates and discretionary spending as higher living costs begin to influence behaviour. The analysis also outlines growing pressure across travel, retail, manufacturing and consumer-facing sectors, alongside the implications for investment, borrowing conditions and the next UK Budget.
Download Full Report Here