British Prime Minister Keir Starmer is set to chair an emergency meeting on the economic fallout from the war in Iran on Monday, with Finance Minister Rachel Reeves and Bank of England Governor Andrew Bailey, the government said.
Investors are bracing for another stormy week in financial markets after Iran said it would affect its Gulf neighbors’ energy and water systems if US President Donald Trump it follows with a threat to hit Iran’s electrical grid.
England watches with some concern. The country’s heavy reliance on imported natural gas, persistent inflation and rising public finances have pushed government bonds into declines faster than those of their international peers.
“Topics expected to be addressed are the economic impact of the crisis on families and businesses, energy security and the stability of industries and supply chains as well as the global response,” Britain’s finance ministry said ahead of Monday’s Cobra meeting. Cobra refers to Cabinet Office Briefing Room A, where the UK government’s emergency committee meets.
Secretary of State Yvette Cooper and Energy Secretary Ed Miliband will attend with Starmer, Reeves and Bailey.
Reeves has said it is too early to say what the effects of the war will be on the British economy and has opposed calls to cost the lives of households, saying instead that more targeted aid is being considered.
The energy price shock threatens to push UK inflation back – possibly to 5 percent later this year, according to some economists – and deal another blow to the slow-growing economy.
