US EditionUK firms hit as Iran war delivers biggest costs rise in 44 years
UK manufacturers face highest monthly cost increase since 1992 due to Middle East conflict driving energy and raw material prices up, with nearly half reporting rising input expenses.
- On March 24, 2026, the S&P Global flash UK PMI dropped to 51.0, with manufacturers' input costs rising at the fastest pace since 1992, firms reported.
- Firms told the survey the US-Israel war with Iran caused weaker demand and disrupted supply chains, with some rerouting shipping via the Cape of Good Hope due to Strait of Hormuz disruptions.
- S&P Global's input-price gauge jumped to 70.2 in March from 56.0 in February, and nearly half of goods producers reported higher input costs this month, prompting fastest price rises since April 2025.
- That deterioration is increasing pressure on the Bank of England, which kept rates on hold last week while investors priced possible hikes, as employment fell for the 18th consecutive month.
- Officials cautioned that the full economic impact depends on how long the energy disruptions last, with Brent nearly 50% up and gas prices over 90%, Finney said, 'The key judgment for Monetary Policy Committee members will be how long the conflict is likely to last and whether higher energy prices will trigger a broader resurgence in inflation pressures.
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UK businesses show growth and inflation hit from Iran war
British business activity has grown at the slowest pace in six months and manufacturers' input costs accelerated at the fastest rate since 1992, according to a survey that underscores the risks to the government's economic agenda from the Iran conflict.
Middle East war 'extinguishing' growth in UK economy
The war in the Middle East is “stalling growth” in the UK economy, fresh data has shown, as firms’ output dropped to a six-month low. A monthly survey of business activity across the country has suggested that there was a slowdown in output as well as a fall in both domestic and international orders, with the war already taking a toll on the private sector. S&P Global’s purchasing managers’ index (PMI) showed that businesses suffered from mark…
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