New UK cost of living crisis looms with soaring energy bills forecast to lift inflation

Latest reading on Wednesday likely to frame scale of challenge for new PM to ease pressures on households amid Iran war fallout

British households are facing a renewed cost of living squeeze, with official figures expected to show this week that soaring energy bills drove up inflation in July to close to 3%.

As the Iran war continues to send shock waves through global energy markets, economists predict the surge in UK gas and electricity bills last month will push Britain's headline inflation rate to 2.9%.