Official figures show that the UK's economic growth slowed in the second quarter of the year. The Office for National Statistics (ONS) reported that Gross Domestic Product (GDP) increased by 0.4% in the three months to June.
This growth rate is down from the 0.6% recorded in the first quarter of the year and aligns with expectations from City economists. The slowdown is attributed to the disruption caused by the Iran war, with sustained high energy prices beginning to impact economic expansion.
The new Chancellor, John Healey, is scheduled to present his first budget on 28 October. With energy prices remaining elevated, there could be pressure for him to provide additional support to households during the upcoming winter.
Inflation figures for July are due to be published next week and are anticipated to show an increase from June's 2.6%, reflecting rising utility bills. Persistent high inflation could lead to increased pressure on the Bank of England to raise interest rates.