The UK’s annual consumer price inflation accelerated to 2.9% in July from 2.6% in June, official data showed, driven by a sharp rise in household energy costs after regulator Ofgem raised its price cap by 13% the prior month.
The increase matched the median forecast of economists polled by Reuters, who had expected inflation to reach 2.9%. The Bank of England, in projections published late last month, had forecast a smaller rise to 2.8%.
The July reading marks a rebound from the 15-month low of 2.6% recorded in June, signaling a pickup in price pressures as energy costs weigh on household budgets. The data, released by the Office for National Statistics, underscores the volatility in inflation dynamics amid shifting energy market conditions and regulatory adjustments to price caps.
The Bank of England’s Monetary Policy Committee has signaled caution in recent communications, balancing concerns over persistent inflation against the need to support economic growth. The central bank’s next policy decision is due in September, with markets closely watching for any shifts in tone regarding the inflation outlook.
