UK and Eurozone Inflation Accelerate to 2.9% in July, Meeting Expectations
| Pair | Now | Since publish |
|---|---|---|
| GBPUSD | — | — |
| EURUSD | — | — |
| GBPEUR | — | — |
- UK and Eurozone inflation rose to 2.9% in July.
- Energy prices were the primary driver for both regions.
- Figures largely matched market expectations.
Consumer price inflation in both the United Kingdom and the Eurozone accelerated to 2.9% in July, largely aligning with market expectations. In the UK, the annual Consumer Price Index (CPI) increased from 2.6% in June, marking its highest level in four months, primarily due to higher household energy prices, including a 13% Ofgem energy price cap hike. Conversely, food inflation remained notably subdued. Similarly, Eurozone inflation edged up from 2.8% in June, also driven by a surge in energy prices, with core inflation rising to 2.5% from 2.4%. Analysts suggest that despite the headline increase, the benign food price component in the UK may reduce pressure on the Bank of England for immediate rate hikes, with some anticipating rates to remain on hold this year.