The annual inflation rate in the UK unexpectedly rose to 3.6% in June from 3.4% in May on higher food and transport costs, in particular fuel, where prices fell by less than last year. The core rate, which excludes volatile food and energy costs, was also higher than expected, climbing to 3.7% from 3.5%, according to the Office for National Statistics. Food prices rose at the fastest pace since February last year, by 4.5% in June. Bread, cereals and cake, along with meat, and milk, cheese and eggs (mainly cheddar cheese) went up in price. These were partly offset by small downward effects from chocolate products, as well as fruit juice. There was inflation in double digits in five categories: beef and veal (20.4%), butter (20%), chocolate (16.3%), coffee (12.3%), and lamb and goat (10.2%). Prices fell the fastest for: olive oil (-9.6%), rice (-3.1%), sugar (-2.6%), and frozen seafood (-1.3%). Transport prices rose by 1.7% in the 12 months to June, up from 0.7% in May. This was because the average price of petrol fell by 0.5 pence a litre between May and June, compared with a larger fall of 3p a litre this time last year. The average price stood at 131.9p a litre, down from 145.8p a year earlier. Similarly, diesel prices fell by 0.6p a litre in June, compared with a fall of 4.8p a litre a year earlier. The average price was 138.5p a litre, down from 151.5p a year earlier. These movements resulted in overall motor fuel prices falling by 9% in the 12 months to June, compared with a larger fall of 10.9% in May. Air fares rose by 7.9% between May and June 2025, compared with a rise of 3.2% a year earlier. Fares usually rise in June but the increase this year was the largest June rise since 2018. The upward effect came from long-haul and European routes. The agenda • 9.30am BST: UK house prices for June • 10am BST: eurozone trade for May • 1.30pm BST: US producer prices for June • 2.15pm BST: US industrial production for June We'll be tracking all the main events throughout the day …
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