Energy Prices Pose Hidden Risks to UK Inflation Outlook

Societe Generale, a French bank, has sounded the alarm about potential energy-driven inflation risks in the UK. According to the bank's analysis, 'energy prices could push inflation higher than current forecasts suggest.'

The warning is based on concerns over supply disruptions and volatile global energy markets, which could reignite price pressures in the UK.

This assessment adds to the challenge for the Bank of England, which has been gradually easing its restrictive monetary policy stance. If energy prices spike, the central bank may need to pause or even reverse course.

The uncertainty surrounding energy costs is particularly relevant as the UK economy shows resilience in recent months, but the energy sector remains a wildcard.