Consumer Prices Accelerate in July as Housing Costs and Household Services Rise

The UK’s annual inflation rate rose to 2.9% in July, reaching its highest level since March, according to the Office for National Statistics (ONS).

The increase marks a rise from 2.6% in June, highlighting renewed pressure on household finances as the cost of living remains a major concern for consumers and businesses.

On a monthly basis, consumer prices increased by 0.3% in July, compared with a 0.2% increase in June.

The ONS said housing and household services, along with furniture and household goods, made the largest upward contributions to the annual inflation rate.

Those increases were partly offset by lower prices in the transport sector, which provided the largest downward contribution during the month.

Meanwhile, core CPI, which excludes energy, food, alcohol and tobacco prices, remained at 2.6% in July, unchanged from June.

The latest figures come as the UK government and Bank of England continue to monitor inflationary pressures and their impact on household spending, interest rates and economic growth.

The rise to 2.9% means inflation remains above the Bank of England’s 2% target, potentially complicating decisions over the pace of future interest-rate reductions.

For households, the latest figures underline continued pressure from essential living costs, particularly housing and household-related expenses.