Home Business NewsUK inflation likely at its near-term peak, but Bank still expected to tread cautiously

UK inflation likely at its near-term peak, but Bank still expected to tread cautiously

by Hugh Lind, Economist at CEBR
20th Aug 25 12:02 pm

CPI inflation accelerated more than expected to 3.8% in July, driven by faster transport and hospitality inflation.

Services inflation also rose to 5.0%, further cementing the existence of persistent price pressure in the economy.

Looking ahead, we believe inflation has likely peaked for the year.

However, with price growth set to stay in excess of 3% for the rest of the year, alongside sluggish growth and a slackening labour market, we expect the Bank of England to tread carefully, delivering only one more cut by the end of the year.

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