Inflation rises for first time in eight months

Inflation rose for the first time since November, with the consumer prices index (CPI) edging up to 2.5%.

The CPI rate had been stable at 2.4% for the previous three months, after falling from a recent high of 3.1% last winter.

The cost of transport and housing pushed prices up in July, although this was partly offset by reductions in clothing and footwear.

Mike Hardie, head of inflation at the Office for National Statistics, said: “Transport tickets and fuel, along with often erratic computer game prices, drove up costs for consumers. On the other hand, there was a drop in prices for women’s clothing and footwear, and some financial services.

“The housing market across the UK again slowed, with London house prices seeing their largest annual fall since September 2009 in the aftermath of the economic downturn.”

The Retail Prices Index (RPI) rate in July is used as a maximum for rail ticket prices the following January.

Laura Suter, personal finance analyst at investment platform AJ Bell, said the increase will add to “already sky-high fares”.

“Fares will rise by 3.2% from January, following a 3.6% hike in January this year,” she said.

“The Office for National Statistics has branded the RPI measure of inflation as ‘flawed’ with ‘serious shortcomings’ and does not recommend it being used, so it remains baffling as to why the Government continues to clobber everyone with price hikes based on an inaccurate measure.”

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