UK Inflation Hits 2.9% as Energy Costs Bite

The UK's inflation rate has increased to 2.9% in July, according to the latest Consumer Prices Index figure from the Office for National Statistics.

This rise is attributed to higher household energy costs, following a 13% increase in the Ofgem price cap from 1 July, which added around £221 per year to the typical household energy bill.

The renewed inflationary pressure comes as the economy faces uncertainty over energy prices, employment, and interest rates. The Bank of England is now weighing its next move on borrowing costs, with persistent inflation potentially increasing pressure for interest rates to rise.