UK CPI inflation climbed from 2.6% to 2.9% in the year to July 2026, the highest rate in several months and still above the Bank of England’s 2% target, according to figures from the Office for National Statistics.
The 0.3 percentage point rise — from 2.6 per cent in June to 2.9 per cent in July — marks the sharpest monthly uptick in headline inflation for some time, the figures show. That’s still a long way from the 11.1 per cent peak recorded in October 2022, but it moves further away from the Bank of England’s 2 per cent target rather than closer to it.
The Confederation of British Industry posted the figures on 19 August 2026, describing the outcome as “in line with consensus expectations.” Core CPI inflation — which strips out energy, food, alcohol and tobacco to give a cleaner read on underlying price pressures — held steady at 2.6 per cent between June and July, unchanged from the previous month.
For Kent households, prices across everyday goods and services are rising at around 2.9 per cent year-on-year. Energy costs have been a key driver of the overall rate, and with Kent’s mix of rural and urban communities — many dependent on cars and home heating — that pressure lands unevenly. Petrol, electricity bills and commuting costs are all affected. Local authorities including Kent County Council, Medway Council and the district councils face the same squeeze on contracts for social care, transport and infrastructure.
The Bank of England held its Bank Rate at 3.75 per cent at its July 2026 meeting, with the Monetary Policy Committee voting 6–3 to keep rates steady. Three members favoured raising the rate to 4 per cent. The Bank had already flagged in its July Monetary Policy Report that inflation was likely to tick upward later in 2026, driven by higher energy prices — so July’s figure fits that projection. Under its remit from HM Treasury, the Bank’s Governor is required to write an open letter to the Chancellor if inflation strays more than one percentage point from the 2 per cent target in either direction. At 2.9 per cent, that threshold has not yet been crossed.
The full breakdown of July’s CPI components — including precise energy, food and transport inflation rates — is due when the ONS publishes its complete bulletin. The core rate holding at 2.6 per cent suggests underlying pressures aren’t accelerating sharply, but the headline figure moving in the wrong direction will keep attention on what the MPC does next.
Source: @CBItweets