ICAEW: UK Inflation Uptick Raises Likelihood of BoE Rate Hike

English summary

UK inflation rose to 2.9% in July. Suren Thiru, chief economist at ICAEW, said drought-driven food price increases and soaring energy costs make inflation exceeding 3.5% later this year more likely, especially if Hormuz traffic disruptions persist. This increases the probability of further BoE monetary tightening by end-2026.