UK food and non-alcoholic drink inflation is forecast to reach 3.9% in December and peak at 6.4% in July 2027, the Food and Drink Federation said, revising its earlier forecast of almost 10% inflation. The federation said the lower peak would last longer than previously expected as the U.S.-Iran war, the closure of the Strait of Hormuz, drought in Europe and El Niño-related weather effects keep energy, logistics, packaging and agricultural costs high. Food and drink inflation fell to 1.3% in July, while overall consumer-price inflation rose to 2.9%. The Bank of England expects food inflation to reach 3.5% by December and headline CPI to reach 3.1%, but considers food and energy prices particularly important in shaping households' inflation expectations. Food and drink prices have risen nearly 40% since 2020. The FDF said higher payroll taxes and tighter advertising and packaging rules added £2 billion to industry costs last year and urged the government to pause planned restrictions on marketing food classified as unhealthy. The federation also warned that the agricultural damage caused by drought and extreme heat, together with Britain's declining food self-sufficiency, could add to longer-term supply risks.