NEWS

UK inflation increases to highest rate in four months

The UK rate of inflation has risen to 2.9% - its highest level in four months.

The rise was driven by higher energy costs, according to the data published by the Office for National Statistics (ONS).

Following regulator Ofgem’s price cap increase, energy bills rose on 1 July, adding £221 a year to a household’s bill.

Chancellor John Healey stated that the war in Iran is also affecting prices, but stressed that the UK economy is resilient.

Some prices, however, have slowed: food inflation is at 1.3% - its lowest for almost five years.

Responding to the latest figures, Caterina Batog, Research and Economics Analyst at the British Chambers of Commerce (BCC), said: ‘Firms continued to feel the heat from inflation last month, with CPI rising to 2.9%, further fuelling the cost of doing business crisis.

‘Higher household energy bills fuelled by the Middle East crisis played a significant part in July’s CPI rise, and as the Bank of England has warned, energy is likely to push up inflation further in the coming months.’

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26/08/2026