Valentina Romei

UK inflation during July remains the highest among the G7, up 3.1 per cent year-on-year. While consumer prices have been flattening in the eurozone and the US – even stoking fears of deflation – UK inflation remains above 3 per cent as it has been all year. The index is down slightly from 3.2 per cent in June.

Energy is driving the rise, via transportation itself affected by the rise of prices of fuels and lubricants. Transportation price rises have been driving UK inflation since autumn of last year, accelerating at the start of 2010 with a 12-month rate above 10 per cent. Annual transportation prices are now 7.8 per cent up on last year.