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Story summary
- UK businesses are adjusting to inflation expectations of 3.5% over the next year, driven by the ongoing Middle East conflict.
- The Bank of England's survey shows firms expect fewer rate cuts, with only one anticipated in the next year.
- Food inflation could reach 9% by year-end due to higher production costs and supply-chain disruptions.
- The conflict has contracted employment expectations and limited pricing power, signaling a fragile economy.
