UK inflation rises to 2.9% in July as energy costs climb

Britain's annual consumer price inflation rate climbed to 2.9% in July, rising from a 15-month low of 2.6% in June, according to official figures released on Wednesday by the Office for National Statistics. The increase, which marked the highest rate since March, was driven by a sharp rise in household energy costs following a 13% hike in the price cap set by regulator Ofgem that took effect last month.

The latest data shows the direct impact of the energy price cap adjustment, which pushed up electricity and gas expenses for consumers. The ONS described this as the largest rise in gas prices for almost four years. Additional upward pressures came from furniture prices falling by less than usual for this time of year and a smaller decline in clothing prices due to reduced discounting. These factors were partially offset by a slowdown in the prices of raw materials and goods leaving factories, driven by a drop in crude oil and refined petroleum costs.

The inflation reading was broadly in line with forecasts from City economists, who had widely anticipated a rise to 2.9%. However, it was slightly above the Bank of England's forecast of 2.8% published in its latest projections....