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The UK is experiencing an unexpected rise in unemployment, with the jobless rate increasing to 5% and a loss of 100,000 jobs—the largest decline in six years. This downturn has led economists to speculate that a planned interest rate hike in June is now less likely.
In addition to rising unemployment, UK households are facing a significant increase in energy bills. From July, the typical dual fuel household will see annual energy costs rise by £209, bringing the total to £1,850. This increase, driven by a 13% hike in the energy price cap set by regulators, is attributed to surging wholesale prices following recent conflicts in the Middle East, particularly the Iran war. The situation has disrupted vital energy supplies, notably through the Strait of Hormuz, a crucial shipping route for global oil and gas.
While energy usage typically decreases during the summer months, the anticipated rise in bills is expected to cause frustration among households. The more pressing concern lies ahead in October, when energy demand is projected to increase again, and current forecasts suggest that prices may remain elevated.
The ongoing geopolitical tensions and their impact on energy infrastructure continue to pose challenges for the UK economy, complicating the outlook for both consumers and policymakers.
Source: www.theguardian.com – https://www.theguardian.com/business/live/2026/may/19/uk-wage-growth-unemployment-rate-markets-business-live-news