3 Apr 2026, 17:42 | Updated: 6h ago
UK firms have said they expect to increase prices more quickly as they come under pressure from surging energy prices.
Picture:
Alamy
UK firms are expecting to increase prices more quickly as they come under pressure from surging energy prices linked to the Iran war, according to the Bank of England.
The central bank’s latest survey of finance bosses across UK companies also highlighted growing uncertainty over the business outlook.
The Decision Maker Panel (DMP) survey showed that firms expected to increase their prices by 3.5 per cent over the next 12 months, according to data for the three months to March.
This is 0.1 percentage point higher than predicted over the three months to February. Meanwhile, the Bank’s single month data increased from 3.4 per cent inflation expectations in February to 3.7 per cent last month.
Read more: Iran oil crisis sparks fastest monthly rise in fuel prices
The survey said this pointed “to firms adjusting their expectations as a result of the recent increases in energy prices”.
Firms took part in the survey between March 6 and March 20, after the start of the conflict in the Middle East.
Nevertheless, oil and gas prices have been volatile in the following weeks and numerous industry groups have pointed to sharper inflation in recent data.
On Wednesday, the Food and Drink Federation predicted that food inflation could soar higher than 9 per cent by the end of the year because of the war in the Middle East.
Elsewhere in the fresh survey data, bosses highlighted a growing level of uncertainty as they tackle the impact of the conflict.
In March, 57 per cent of firms reported that the overall level of uncertainty facing their business was high or very high, up by 10 percentage points from February.
Uncertainty around price inflation for the year ahead also grew for the month.