British consumer price inflation rose to 2.2% after two months at the Bank of England’s 2% target, official figures showed on 14 August.

Economists polled by Reuters had forecast the annual CPI rate would rise to 2.3%.

When the BoE cut interest rates from a 16-year high of 5.25% at the start of this month, it said May and June’s 2% inflation readings probably marked a low point for inflation.

The central bank expected CPI to rise to 2.4% in July and reach around 2.75% by the end of the year as the effect of sharp falls in energy prices in 2023 faded, before returning to 2% in the first half of 2026.

British inflation peaked at a 41-year high of 11.1% in October 2022 driven by a surge in energy and food prices after Russia’s full-scale invasion of Ukraine as well as Covid-19 labour shortages and supply chain disruption.