Following the latest Bank of England (BoE) meeting, the central bank's analysis suggests both green and red signals on the health of the UK economy, with underlying inflationary pressures muted, despite the ongoing energy shock.
On the positive side, the economy appears to have come through the initial energy price shock relatively unscathed.
More worrying are flashing red indicators for the labour market, which has been on a weakening trend since the middle of 2025.
It is in this subdued macro context that BoE Governor Andrew Bailey stated that there is, as yet, very little evidence of second round inflation.
