UK inflation falls 1.1% in just one month as Ukraine war energy price crisis starts to ease

UK price inflation fell 1.1 per cent in a month to approach levels not seen since Russia’s invasion of Ukraine in February 2022, but experts warned the cost of living squeeze was far from over despite the turning ride on rising prices.

Office for National Statistics data published on Wednesday morning showed the Consumer Prices Index (CPI) stood at 6.8 per cent in July – down from 7.9 per cent in the previous month and broadly in line with what most economists had predicted. The drop was attributed to falling energy prices.

Rising prices have slowed for two consecutive months and are now being outstripped by record wage growth. But core inflation – which strips out volatile food and energy prices – remained unchanged at 6.9 per cent and experts warned any gains in pay would be “swallowed up” by increased borrowing costs and higher taxes.