Public Event Detail
Deutsche Bank: Middle East energy shock could derail BoE’s disinflation path
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Event summary
Deutsche Bank warns that an energy shock stemming from escalating US-Iran conflict and the effective closure of the Strait of Hormuz could push UK inflation back towards 3% by late 2026, threatening the Bank of England's disinflationary efforts. This could force the BoE to maintain higher interest rates for longer, potentially dampening UK GDP. The report highlights the "pro-inflationary" bias introduced by surging Brent Crude prices and the complex challenge faced by the Monetary Policy Committee in balancing growth with imported cost-push inflation.