UK inflation steady before Iran war; oil dips on Trump comments – business live

UK inflation stays at 3% in February, before Iran war drove up global energy costs Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy. Inflation in the UK was unchanged last month, as expected – before the Iran war drove up global energy costs, threatening a renewed price jump. While we expected February’s inflation data to remain stable around 3%, increasing oil prices are widely expected to push up the headline rate of inflation to near double the 2% target later this year, threatening the Bank’s slow and steady rate cutting cycle and frustrating markets. Should this materialise, markets are unlikely to respond well. While the Bank of England has signalled a cautious and data dependent approach to monetary policy, resulting in a hold at 3.75% last week, financial markets have already reacted sharply to the changing global outlook. Investors are now pricing in the possibility of multiple interest rate increases this year, with some expectations pointing to as many as four rises before the end of 2026. The gap between market expectations and the Bank’s own guidance highlights just how uncertain the inflation outlook has become. Continue reading...

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