Chancellor John Healey has warned that the government is watching closely for signs of profiteering by big retailers and fuel sellers as the ongoing conflict involving Iran continues to push up prices in the UK. Writing in the Sunday Telegraph, he said ministers wanted to stop shoppers being "taken for a ride at the pump or the till", though he acknowledged there was "no significant evidence of so-called price gouging" so far. The remarks risk reigniting tensions between government and retailers, coming as the energy shock from the Middle East conflict adds fresh pressure to the cost of living.

The warning follows the Bank of England's decision last week to hold interest rates, alongside a caution that further escalation in the conflict could push inflation above 4% next year. It also echoes an earlier row sparked by former chancellor Rachel Reeves, who floated a possible cap on food prices, prompting M&S chief executive Stuart Machin to call the idea "completely preposterous". The British Retail Consortium hit back on Sunday, with its Andrew Opie arguing that fierce competition, not government intervention, has kept UK food prices among the lowest in western Europe, and suggesting Healey instead scrutinise the inflationary effect of tax rises such as employer national insurance and business rates.