Inflation Jumps to Four-Month High as Energy Bills Surge
UK inflation rose to a four-month high in July due to a surge in household energy bills, according to data released by the Office for National Statistics. The annual consumer price inflation rate increased to 2.9 per cent from June's 15-month low of 2.6 per cent.
The maximum tariff allowed by British regulators on energy firms rose by 13 per cent last month, contributing to the higher inflation rate. Economists had widely forecast this outcome, but the Bank of England had predicted a smaller increase to 2.8 per cent in its forecasts at the end of July.
Prime Minister Andy Burnham has made reducing cost-of-living pressures on British households a priority, and these data may reassure him that his focus is on track. However, stretched public finances before the annual budget in October offer little room for broad assistance.