UK economy expands 0.6% in Q1, meeting expectations and providing relief for Labour government facing mounting pressure. Growth was broad-based across the services sector, with production also posting modest gains and construction returning to positive territory after recent weakness. However, analysts warn that underlying economic strength may be masking emerging headwinds. The Iran conflict has already begun straining global energy supply chains, with the effective closure of the Strait of Hormuz disrupting approximately 20% of world oil and gas transit. As a net energy importer, the UK has already experienced rising consumer prices driven by fuel costs. The Bank of England is monitoring the situation closely and may adjust interest rates depending on conflict duration and economic impact.
