The UK’s economic outlook has been shaken by a surprise rise in inflation, complicating plans for an anticipated interest rate cut in August. Despite a strong start to the year, recent data shows inflation quickening unexpectedly, particularly in food prices, adding to the burden on households already grappling with prolonged cost-of-living pressures. While markets had largely assumed a rate cut from the current 4.25% was imminent, the spike in inflation has introduced renewed caution. Former Bank of England policymaker Andrew Sentance called any cut next month 'irresponsible’. The Bank must now weigh current inflation against forecasts that predict a return to its 2% target by 2026. Complicating the picture further is the weakening jobs market, with unemployment expected to rise to 4.9%. While other major economies, like the eurozone, maintain stable inflation, the UK remains vulnerable to wage and tax-related price pressures. However, energy prices are expected to fall in the autumn, which may ease inflation, and there are signs of sectoral recovery and no current risk of recession.