The Bank also expects the economy to grow more than previously forecast this year, although uncertainties remain because of the Iran war.

The Bank of England has kept interest rates unchanged for the fifth meeting in a row but has indicated it could raise them if the Iran war escalates. It expects inflation - the rate at which prices rise - to pick up due to volatile oil and gas prices caused by the Middle East conflict, although the peak will be slightly lower than previously thought. Bank of England governor Andrew Bailey warned the future of UK interest rates depended on whether the US led war against Iran continues. While major uncertainties remain because of the war, the Bank predicts the UK economy will grow this year by more than previously forecast. Bailey told the BBC: "If we get a continuation of this conflict going on and oil prices stay above $100 a barrel... the odds are that interest rates will have to go up higher." But he also said if a ceasefire, and memorandum of understanding, is established and sticks that would make a difference. "So it depends on how the events in the Middle East, frankly, unfold. And sadly, we all know this is highly unpredictable," Bailey said. Three members of the Bank's nine-member rate-setting committee voted for a hike, one more than the previous meeting - with that member explicitly citing the collapse of the US-Iran memorandum of understanding for their vote to raise rates.