Persistent extreme heat and scarce rainfall are increasingly weighing on UK
activity: about two-thirds of England is now in formal drought. Prime Minister
Andy Burnham convened an emergency meeting this week on drought and wildfires.
Heat is keeping consumers off high streets, hitting agriculture, delaying
construction and reducing labor productivity. A Friday institutional analysis
estimates cumulative losses at roughly £6bln, about 0.2% of output. Economists
say the hot summer is a negative supply shock; while GDP-level effects may be
temporary, there is a risk it could push up prices in some sectors, complicating
the Bank of England's fight against elevated inflation.