Rachel Reeves faces £8BILLION a year financial hit as US-Iran war to 'damage the economy'

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Rachel Reeves faces £8BILLION a year financial hit as US-Iran war to 'damage the economy'.

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The Institute for Public Policy Research (IPPR) has issued an urgent warning that the ongoing conflict between the United States and Iran could inflict severe damage on Britain's economy and public finances.According to new analysis from the think tank, a prolonged Middle Eastern war risks costing the Treasury as much as £8billion annually through increased debt servicing costs and diminished tax receipts.The IPPR's modelling suggests that without government intervention, consumer price inflation could surge to 5.8 per cent under a protracted stalemate scenario, far exceeding the Bank of England's two per cent target.Economic growth would also suffer significantly, with real gross domestic product (GDP) potentially slowing to just 0.3 per cent.More than a quarter of UK Government debt is linked to inflation, meaning each additional percentage point directly increases borrowing costs.To address the crisis, the IPPR has proposed a temporary energy price cap set at £2,000, designed to...

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