20 Aug 2025
Data published by the Office for National Statistics (ONS) has revealed that inflation rose to 3.8% in July from 3.6% in June.
The latest figure represents the largest increase in inflation since January 2024. Many experts expect inflation to reach 4% in September before starting to fall.
Grant Fitzner, Chief Economist at the ONS, said: 'The main driver of inflation was a hefty increase in air fares, the largest July rise since collection of air fares changed from quarterly to monthly in 2001.
'This increase was likely due to the timing of this year's school holidays. The price of petrol and diesel also increased this month, compared with a drop this time last year.
'Food price inflation continues to climb, with items such as coffee, fresh orange juice, meat and chocolate seeing the biggest rises.'
Chancellor Rachel Reeves commented: 'We have taken the decisions needed to stabilise the public finances, and we're a long way from the double-digit inflation we saw under the previous government, but there's more to do to ease the cost of living.
'That's why we've raised the minimum wage, extended the £3 bus fare cap, expanded free school meals to over half a million more children and are rolling out free breakfast clubs for every child in the country.
'Through our Plan for Change we're going further and faster to put more money in people's pockets.'