• It’s hard to know what the focus of this Weekly should be – the ongoing implosion of Boris Johnson’s government or the explosion of European gas prices. Our focus is on the latter because – notwithstanding some tinkering at the edges on UK fiscal policy – it is likely to cause far more economic and market disruption than UK political uncertainty (which, after all, we’ve come to get rather used to over recent years).

• At the start of this week euro area May producer prices reported their smallest gain since early 2021. At the time we write this column the upside risks to inflation have never seemed greater, as European gas and electricity prices have soared once again.

• Even if it’s not sustained, the volatility in energy prices is probably sufficient in itself to hit household and corporate confidence that it will show up in weaker consumer spending and business investment anyway. The only good news is that agricultural prices have fallen noticeably, but that is tempered by the fact that they are still 75% higher than where they were in mid-2020.

By Nomura

• Not only is it a case of surging prices, but for Europe it’s all about energy security. Next Monday the Nord Stream 1 pipeline – which runs from Vyborg in north west Russia under the Baltic Sea to Lubmin in northeastern Germany – is due to be switched off for routine annual maintenance work. When it’s due to be tuned back on 10 days later on Thursday 21 July there is huge uncertainty as to how much gas will end up flowing through the pipeline