Burnham warned of Iran war impact on UK growth next year
The conflict in the Middle East has pushed up oil and fuel prices, and also disrupted supply chains.
Andy Burnham has received a briefing indicating that the UK's economic growth could be severely hampered next year, potentially reaching as low as 0.3% in 2027, should the Strait of Hormuz continue to experience disruptions through 2026. This internal Treasury modeling, which was also presented to the new prime minister and chancellor, was initially reported by Bloomberg.
Government officials stated that such scenario planning is a routine part of their operations.
Following a robust start to the year, the UK economy experienced a slowdown, with the ongoing Middle East conflict impacting various businesses. The conflict involving Iran has led to increased oil and fuel prices and has also caused disruptions in supply chains.
Official figures are anticipated on Thursday, revealing the extent of economic growth between April and June of this year. Economists are forecasting a 0.4% growth for that three-month period. The UK economy had previously shown a return to growth in May.