Britain’s annual inflation rate rose to 2.9 per cent in July, driven mainly by higher household energy costs, according to official data.
The Office for National Statistics (ONS) said the Consumer Prices Index increased from 2.6 per cent in June to 2.9 per cent in the 12 months to July, in line with analysts’ expectations.
The increase followed a 13 per cent rise in the household energy price cap that took effect in July. The ONS described the increase in gas prices as the largest in almost four years.
Finance Minister John Healey said the continuing conflict in the Middle East was contributing to inflationary pressures in Britain, while acknowledging that more measures were needed to ease the cost of living.
Analysts expect inflation to remain elevated in the coming months as higher energy costs continue to affect household bills.
The Bank of England has maintained its benchmark interest rate at 3.75 per cent, despite inflation remaining above its 2 per cent target.
Investment manager Jonathan Raymond of Quilter Cheviot said continued uncertainty around the Strait of Hormuz could keep pressure on prices for the rest of the year.
