LONDON (REUTERS) - Britain's poorest households will by hit by an inflation rate of more than 10 per cent as the war between Russia and Ukraine pushes up energy and food prices, and Chancellor of the Exchequer Rishi Sunak should ease the hit in a budget update next week, a think-tank said.

The Resolution Foundation said on Monday (March 14) that consumer price inflation was likely to surpass 8 per cent and would go over 10 per cent in the autumn for the poorest families, who spend twice the share of family budgets on food and energy than the richest tenth.

Resolution Foundation research director James Smith said there was a risk of a recession but added that Mr Sunak had room for about £30 billion (S$53.4 billion) worth of extra borrowing as tax revenues were likely to come in higher than previously expected.

"The top priority should be to protect poorer households, who are most exposed to the biggest cost-of-living crisis Britain has faced in generations," Mr Smith said.

He called for an 8 per cent increase in welfare benefits, rather than the 3.1 per cent planned for April.

"The Chancellor cannot protect Britain entirely from the difficult times that lie ahead, but he needs to act urgently to ensure the pain is fairly shared," Mr Smith said.

Britain's Finance Ministry said on Sunday it would continue to monitor the economic impact of the conflict and keep its approach under review.

Mr Sunak is due to announce an update to his budget plans on March 23.