BoE Governor Bailey: Iran War and Weather Could Raise Inflation

Energy Market Impacts Bailey highlighted that large-scale disruptions in the Strait of Hormuz and pressure on refinery capacity could push energy prices higher.
He noted that continued disruptions in oil shipments could further accelerate inflation.
Food Inflation The BoE's current forecasts suggest food inflation in the UK could reach about 3.5% by year‑end.
Bailey said this estimate should be reassessed in light of changes in energy prices and weather conditions affecting food prices.
Capital Economics predicts that the slowing food inflation last year could rise to around 5% next summer.
Economic Context Bailey's remarks come as the UK government faces borrowing costs at their highest in roughly 30 years, potentially increasing global market volatility.