On August 16, all eyes will be on the UK’s Consumer Price Index (CPI) release next week. Currently, the Bank of England is sounding the alarm over a shortage of AI-driven memory chips and escalating energy costs. Data due out on Wednesday is expected to reveal a four-month high in inflation acceleration. According to an institutional survey, economists anticipate a median inflation rate of 2.9% for July, signaling that inflationary pressures will persist into the second half of the year, potentially dampening recent optimism over easing price pressures. Against a backdrop of robust economic performance, the unfolding impact of the situation in Iran on prices is gradually coming to the fore, which may further fuel concerns among Bank of England policymakers regarding interest rates. While the inflation outlook is significantly shaped by developments in the Middle East, artificial intelligence is emerging as a new catalyst. The Bank of England cautions that the rapid growth in AI computing power is pushing up the cost of memory chips used in electronic products such as smartphones, laptops, and gaming consoles. Data from the British Retail Consortium in July indicates that the surge in chip costs has already translated into higher prices for electronic goods.