The UK's Office for Budget Responsibility warns that any percentage point change in interest rates could shift the interest costs of government debt by £16bn, as persistently high energy prices threaten to push up inflation. - OBR forecasts inflation of 3.5% in 2027, up from 2% previously, with a quarterly peak of 3.75% expected in early 2027. - If energy prices will remain higher for longer, inflation may rise further, near-term GDP growth may weaken, and financial conditions may tighten.

The UK's Office for Budget Responsibility warns that any percentage point change in interest rates could shift the interest costs of government debt by £16bn, as persistently high energy prices threaten to push up inflation. - OBR forecasts inflation of 3.5% in 2027, up from 2% previously, with a quarterly peak of 3.75% expected in early 2027. - If energy prices will remain higher for longer, inflation may rise further, near-term GDP growth may weaken, and financial conditions may tighten.