Inflation eases but food, transport exposed: comment

“Inflation holding steady in February will bring little real relief for households or Bank of England policymakers. Mortgage costs have risen on higher inflation expectations [2], while food [3], heating and transport bills remain highly exposed to volatile oil and gas prices.

“The war in the Middle East has underlined just how quickly that vulnerability can hit home. Petrol prices have risen sharply, and businesses are already reporting higher costs for energy, transport, fertiliser and other inputs, some of which will likely feed into the March figures. While oil and gas companies’ profits will likely rise, families will foot the bill through higher shopping and energy bills with inflation at risk of climbing back above 4% later this year if oil and gas prices remain elevated.

“With scientists warning that El Niño could return sooner than expected [4] and compound the extreme heat that climate change is already driving around the world, food production is in jeopardy. 2026 is shaping up to be another year in which conflict and climate risks become a costly reality.”

Notes to editors:

1. Inflation rate: https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/consumerpriceinflation/february2026 

2. The Guardian: https://www.theguardian.com/lifeandstyle/2026/mar/19/why-mortgage-rates-going-up-bank-of-england-base-rate-same

3. ECIU: https://eciu.net/analysis/reports/2023/climate-fossil-fuels-and-uk-food-prices-2023 

4. BBC News: https://www.bbc.co.uk/news/articles/c203rdxkezwo

For more information or for interview requests:

George Smeeton, Head of Communications, ECIU, t: 020 8156 5305, m: 07894 571 153, email: george.smeeton@eciu.net