Around 200,000 UK households are projected to fall below the poverty line due to rising energy bills, petrol prices, and food costs driven by the ongoing conflict in Iran. Economists warn that these financial pressures are exacerbated by existing economic vulnerabilities, particularly affecting the lowest-income families who spend a larger share of their income on essentials.
The conflict has triggered a surge in energy prices, which, combined with inflation expected to rise above 4%, is creating a perfect storm for household budgets. The National Institute of Economic and Social Research (NIESR) highlights that the economic slowdown will likely weaken wage growth and increase unemployment, further straining finances for those already struggling.
For many families, this means a stark reality: as costs rise, their disposable income shrinks, pushing them closer to absolute poverty. Those newly affected may find themselves with as little as £500 to £1,000 available each month after housing costs, making it increasingly difficult to afford basic necessities.
Looking ahead, if the conflict continues and the Strait of Hormuz remains blocked, the economic outlook could worsen significantly. NIESR forecasts that prolonged disruptions could lead to a recession, with inflation potentially surging past 5% and joblessness climbing, signalling a challenging period for many UK households.
Sources
gbnews.com
