Surprisingly benign UK inflation data signals a softer Iran war hit than feared

The better-than-expected economic readings come despite consumers enduring rapid increases in the price of petrol. Photograph: Kevin Wheal/Alamy

As soon as Iran choked off oil supplies through the strait of Hormuz at the start of March, there were dire warnings about rocketing UK inflation and the drastic action the Bank of England might take to rein it in.

At one point, investors were expecting as many as three quarter-point rises in interest rates before the end of the year – a sharp turnaround from earlier forecasts of rate cuts.