Prices in the UK rose even faster than expected last month, reaching the highest level in more than 18 months, according to official figures.
Inflation hit 3.8% in July, data from the Office for National Statistics (ONS) showed.
Not since December 2023 have prices risen as fast.
It’s up from 3.6% in June and is anticipated to reach 4% by the end of the year.
Economists polled by Reuters had only been expecting a 3.6% rise.
Another measure of inflation that’s closely watched by rate setters at the Bank of England rose above expectations.
Core inflation – which measures price rises without volatile food and energy costs – rose to 3.8%. It had been forecast to remain at 3.7%.
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It’s not good news for interest rates and for anyone looking to refix their mortgage. The Bank’s target for inflation is 2%.
More unwelcome news is contained elsewhere in the ONS’s data.
Another metric of inflation used by government to set rail fare rises, the retail price index, came in at 4.8%.
It means train tickets could go up 5.8% next year, depending on how the government calculate the increase.
This year, the rise was one percentage point above the retail price index measure of inflation.
These regulated fares account for about half of rail journeys.
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