The latest figures from the Office for National Statistics show the Consumer Prices Index (CPI) measure of price inflation up 2.6% for the year to July.
This follows a bigger than expected fall in inflation the previous month, when CPI fell to 2.4% in June.
The Retail Prices Index (RPI) measure of inflation also increased in July.
RPI rose to 3.2% from 2.8% the previous month, which represents bad news for commuters as rail price increases are based on the inflation figure for July.
Rail fares will now increase in January by amounts pegged to this 3.2% RPI figure. Some fares in England will increase by 6.2% at the start of next year.
Whilst inflation has halved since September, the Treasury has been quick to describe any monthly increase as “disappointing”.
One of the biggest factors in forcing inflation higher this month was air fare prices, rising by 21.7% during the month. Second-hand cars also saw price increases, while falling fuel prices helped to offset some of the inflationary pressures.
Taking the June and July inflation figures together suggests that we are still experiencing a downward trend in inflation figures.
The Bank of England and leading economists still expect to see inflation fall closer to the government target of 2% by the end of this year. A blip in price inflation this month should not raise too many concerns and is unlikely to derail the Bank of England programme of quantitative easing.
Photo credit: JMC Photos
