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UK inflation rises to 2.2%, in first increase of the year
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UK inflation rises to 2.2%, in first increase of the year
Rolling coverage of the latest economic and financial news, including the latest UK inflation report
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How UK’s poor paid price of ‘cheapflation’ in cost of living crisis
Environment  
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Birmingham  
Council to sell off athletes’ village homes at more than £300m loss
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UAW files charge against Donald Trump and Elon Musk over strike threat
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Company's technology could be used to drill on Mars or moon after Nasa deal
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Intel sued by fired Jewish employee over ex-supervisor’s alleged antisemitism
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Bellway walks away from £720m Crest Nicholson takeover bid
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Owner of Avon in UK files for bankruptcy in attempt to off-load $1bn debt
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Road sweeper denied crowdfunded holiday will go on trip after all
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Rachel Reeves ponders private finance to help fund £9bn Lower Thames Crossing
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‘Miscommunication’ over Costa drinks order may have led to girl’s death, inquest told
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Richard Masters: time is right to resolve Manchester City’s alleged breaches case
Today's agenda
UK inflation has risen, as feared, for the first time this year.

The consumer prices index (CPI), which measures changes in the cost of living, rose by 2.2% in the year to July.

That is an increase from 2% in May and June, and the first increase in inflation since last December (when CPI inflation was 4%).

But it’s not quite as high as the 2.3% that City economists expected.

On a monthly basis, the CPI inflation rate fell by 0.2% in July 2024, compared with a fall of 0.4% in July 2023.

Core inflation (which excludes energy, food, alcohol and tobacco) has slowed.

Core CPI rose by 3.3% in the 12 months to July 2024, down from 3.5% in June.

This may seem a bizarre measure if you are a household whose budget is mostly spent on essentials such as eating and keeping warm.

But it is an important measure of underlying price pressures.

Inflation in the UK’s service sector has slowed.

The CPI services annual rate fell from 5.7% to 5.2% – that should please hawks at the Bank of England, who fear that services prices will remain sticky.

On the other side of the economy – goods prices fell at a slower rate. The CPI goods annual rate rose from -1.4% to -0.6% in July.

Encouragingly, UK manufacturers raised their prices at a slower rate in July.

The latest survey of producer prices shows that prices at the factory gate rose by 0.8% in the year to July 2024. That is down from 1% in the year to June 2024.

Factories were hit by a small increase in costs – input prices rose by 0.4% in the year to July 2024, having been flat in June.

The agenda
• 9.30am BST: UK house price inflation and rental costs
• 10am BST: eurozone Q2 GDP report (second estimate)
• 1.30pm BST: US inflation report for July
• 3.30pm BST: EIA crude oil inventory data

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