UK Inflation Hits 2.9% as Energy Bills Soar

The UK is bracing for a renewed cost of living crisis as soaring energy bills are expected to push inflation up to 2.9% in July, according to forecasts.

Economists predict that the increase in gas and electricity prices will add about 0.44 percentage points to the headline inflation rate, partly offset by falling petrol and diesel prices.

The Office for National Statistics (ONS) is set to release figures on Wednesday showing a jump from 2.6% in June, a rise attributed to Ofgem's 13% lift on household gas and electricity bills in July.

Thomas Pugh, chief economist at RSM UK, warned that the increase would add fresh pressure to household budgets and complicate interest rate decisions.