{"id":61452,"date":"2026-08-19T05:45:27","date_gmt":"2026-08-19T09:45:27","guid":{"rendered":"https:\/\/newssprinters.com\/index.php\/world\/jump-in-energy-bills-drives-uk-inflation-to-highest-rate-for-four-months\/19\/08\/2026\/"},"modified":"2026-08-19T05:45:27","modified_gmt":"2026-08-19T09:45:27","slug":"jump-in-energy-bills-drives-uk-inflation-to-highest-rate-for-four-months","status":"publish","type":"post","link":"https:\/\/newssprinters.com\/index.php\/world\/jump-in-energy-bills-drives-uk-inflation-to-highest-rate-for-four-months\/19\/08\/2026\/","title":{"rendered":"Jump in energy bills drives UK inflation to highest rate for four months"},"content":{"rendered":"

\n<\/p>\n

\n

Higher energy bills drove UK inflation up to 2.9% in the 12 months to July, the latest figures show. <\/p>\n

Gas prices rose at the highest rate in almost four years, the Office for National Statistics (ONS) said, which led to an increase to the energy price cap in July. Energy prices surged after US-Iran war began in February, which has restricted global oil supplies. <\/p>\n

It is the highest rate of inflation since March, but some price rises have slowed: food inflation, at 1.3%, is at its lowest rate for close to five years. <\/p>\n

Experts say Wednesday’s inflation figure is unlikely to influence the Bank of England to change its key interest rate at its next meeting in September. <\/p>\n

Energy costs rose on 1 July after regulator Ofgem increased the price cap on household gas and electricity bills by 13%, which added \u00a3221 a year to the typical household’s bill. <\/p>\n

Energy bills are forecast to rise by 4% from October, according to Cornwall Insight, which could see bills rise to their highest level since July 2023. <\/p>\n

The independent energy consultancy increases are being driven by ongoing uncertainty over the US-Iran conflict, which has seen effective closures of the Strait of Hormuz, a key trading passage for oil-carrying ships. <\/p>\n

Cornwall Insight added that energy price pressures were being compounded by the ongoing heatwave across Europe, “increasing gas demand for power generation to meeting air conditioning and cooling demand”. <\/p>\n

\n
\n
<\/a><\/div>\n<\/div>
[BBC] <\/figcaption><\/figure>\n

ONS prices director Mike Hardie said furniture prices, which fell by less than usual for that time of year, added to the upward pressure on inflation. He said clothing was also not being discounted as much. <\/p>\n

Chancellor John Healey said the Iran war was continuing to affect prices in the UK, but insisted Britain’s economy was resilient. <\/p>\n

“We have cut VAT on electricity bills and capped bus fares at \u00a32 – to give breathing space to those feeling the strain,” he said. <\/p>\n

“There is more to do to restore hope and build a stronger economy where prosperity is shared more fairly across Britain.” <\/p>\n

Shadow chancellor Mel Stride said the country was unprepared for global shocks due to Labour’s “mismanagement”, leaving ordinary people “paying the price”. <\/p>\n

\n
\n
\"Penny<\/a><\/div>\n<\/div>
[BBC] <\/figcaption><\/figure>\n

Penny Keevil says the cost of living crisis is here to stay. She founded crisis support centre Second Chance Medway, which runs a discounted food pantry two days a week, where she now sees not only people on benefits, but working people too. <\/p>\n

“The need for affordable food now reaches across every part of the community,” she said. <\/p>\n

“Energy bills are still far too high and wages and incomes aren’t keeping up”. <\/p>\n<\/p><\/div>\n

\n

The British Retail Consortium’s Harvir Dhillon said there was some good news for consumers as food inflation slowed. <\/p>\n

He said prices for pasta, olive oil and fresh fruit all fell in July, “demonstrating that strong competition among grocers is firmly keeping a lid on people’s weekly shop”. <\/p>\n

Meanwhile, motor fuel price rises eased to 15.5% compared to an increase of 21.3% in the 12 months to June – though they remains much higher than in 2025. <\/p>\n

Rises on the horizon <\/h2>\n

KPMG’s chief economist Yael Selfin said July marked the start of a gradual rise in inflation, though she said Wednesday’s figure was not enough to spur change in the Bank of England’s interest-rate setting decisions. <\/p>\n

But Selfin added that energy-related costs were expected to push inflation higher over the coming months to a peak of about 3.5%. <\/p>\n

The inflation rate remains above the Bank’s 2% target – a level the Bank says keeps prices stable and allows both people and businesses to plan for the future. <\/p>\n

Chief economist of Capital Economics, Ruth Gregory, expects inflation will fall to that target “by the end of next year” provided energy prices don’t rise much further. <\/p>\n

She suspects the “Bank of England will keep rates at 3.75% this year and cut them to 3.00% next year”. <\/p>\n

AJ Bell’s head of personal finance Sarah Coles inflation said inflation is “nothing like as dramatic as it was during the height of the cost-of-living crisis”. <\/p>\n

She said that the price of some goods was falling, including jam, marmalade, honey, pizza and quiche, as well as men’s clothing and shoes. <\/p>\n

But price stability remains elusive, said Suren Thiru, chief economist at the Institute of Chartered Accountants in England and Wales. <\/p>\n

“Rising inflation is likely to become the biggest threat to UK growth in the coming months as it eats into household budgets by increasing the cost of essentials,” he said. <\/p>\n

He added drought-related increases in food prices were also on the the horizon. <\/p>\n

\n
\"tracking\"<\/div>\n<\/div><\/div>\n

Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Higher energy bills drove UK inflation up to 2.9% in the 12 months to July, the latest figures show. Gas prices rose