Crisis in Middle East could lead to surge in UK inflation back up to 3% says OBR

by Jamie Burford

The economic forecaster believes energy prices could spike the rate of inflation up to 3% by the end of 2026, due to conflict in the Middle East.

OBR and Bank of England projections initially expected UK inflation to fall between 2.1% and 2.3% by late 2026. However, due to the US-Israel war in Iran, the year could end with inflation at a percentage point higher at 3%, because of the energy price shock triggered by the calamity in the Middle East.