BOE Warns Energy Price Volatility May Linger Until 2027

Bank of England Chief Economist Huw Pill has warned that energy price volatility could persist into 2027, potentially keeping inflation elevated for longer.

The BOE's concern stems from the ongoing conflict in the Middle East, which remains 'profoundly uncertain' and difficult to predict, according to Pill. He noted that the stop-start nature of US-Iran talks in recent weeks highlights the lack of visibility on both the duration and scale of the conflict.

Pill's comments come as energy prices continue to fluctuate wildly due to the ongoing war, which has led to concerns about inflation staying elevated for longer. The BOE has previously highlighted the risks associated with commodity price volatility and its impact on inflation.