Energy Price Hike Looms as UK Inflation Nears 3%
The UK's cost of living crisis is expected to worsen as energy bills drive inflation up to nearly 3% in July, according to economists.
After Ofgem lifted its cap on household gas and electricity bills by 13%, experts predict the surge in prices will add about 0.44 percentage points to headline inflation.
Thomas Pugh, chief economist at RSM UK, said: 'The cost of living squeeze is set to return to the headlines.'
The Bank of England is considering raising interest rates from as early as September in response to concerns over stubbornly high inflation becoming entrenched in the economy.
Economists warn that the impact of the Iran war on global energy markets will weigh more heavily in the second half of the year, with Britain's economy showing resilience but facing renewed inflationary pressures and heightened uncertainty.