UK inflation unexpectedly accelerated to 3.8 per cent in July, the quickest pace in a year and a half, further dampening hopes that the Bank of England will cut rates in the near future.
Wednesday’s figure from the Office for National Statistics exceeded the 3.7 per cent forecast by economists polled by Reuters and was up from the 3.6 per cent recorded in June.
July’s gains were driven by transport, including air fares, as well as higher motor fuel costs. Food and non-alcoholic beverage prices were up 4.9 per cent from the same period a year ago, the fourth consecutive increase, the ONS said.
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