Sky News Business4/22/2026EconomyUnited Kingdom
UK inflation rises to 3.3% as economists warn of 7% peak if Middle East conflict persists
Capital Economics forecasts headline inflation could top 7% by year-end under adverse scenario, with energy bills and airfares set to surge
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- UK inflation rose to 3.3% in March from 3% in February, driven by fuel prices, as economists warn of potentially worse to come if the US-Iran conflict continues.
- Capital Economics forecasts inflation could hit 7% under an adverse scenario, with energy price inflation peaking at 18.1% in July and airfares rising up to 50%.
- The Resolution Foundation warns of a £16bn hit to public finances from a prolonged Middle East conflict.
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UK inflation rose to 3.3% in March from 3% in February, driven by fuel prices, as economists warn of potentially worse to come if the US-Iran conflict continues. Capital Economics forecasts inflation could hit 7% under an adverse scenario, with energy price inflation peaking at 18.1% in July and airfares rising up to 50%. The Resolution Foundation warns of a £16bn hit to public finances from a prolonged Middle East conflict.
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