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

2026-08-14

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.