Latest UK-focused news and updates.
In the UK, the spring economic forecast is set to be delivered by Shadow Chancellor Rachel Reeves, who is expected to assert her confidence in her economic strategy. However, economists warn that ongoing conflicts in the Middle East may pose challenges to her plans. The International Monetary Fund (IMF) has noted that the crisis has already disrupted trade and economic activity, leading to increased energy costs and volatility in financial markets. A more detailed assessment of the economic impact is anticipated in April.
Recent data from Worldpanel by Numerator indicates that UK grocery price inflation has risen to 4.3% in February, up from 4% in January, marking the first increase in four months. This rise in grocery prices is expected to further strain household budgets, particularly as energy prices continue to climb.
The situation in the oil and gas sector is complex. Major companies like BP and Shell have seen improved market sentiment due to rising oil prices, although neither has production in Iran. BP's operations in Iraq and Abu Dhabi could face disruptions if tensions escalate in the Strait of Hormuz. Similarly, Shell's liquefied natural gas (LNG) facilities in Qatar and the Emirates are at risk.
Despite these uncertainties, analysts suggest that both BP and Shell may benefit from increased trading opportunities. Shell's strong balance sheet positions it well to navigate prolonged market volatility, while BP has paused its share buybacks. Shell, on the other hand, is expected to continue its generous shareholder payouts throughout the year.
As the UK grapples with these economic challenges, the focus remains on how Reeves's proposed economic plan will address the rising costs impacting consumers and businesses alike.
Source: www.theguardian.com – https://www.theguardian.com/business/live/2026/mar/03/spring-forecast-rachel-reeves-statement-economic-plan-obr-oil-gas-stock-markets-live-updates