Pepperstone logo
Pepperstone logo
  • English
  • 简体中文
  • 繁体中文
  • ไทย
  • Tiếng Việt
  • Español
  • Português
  • لغة عربية
  • Ways to trade

    Pricing

    Trading accounts

    Pro

    Premium clients

    Active Trader Program

    Refer a friend

    Trading hours

    24-hour trading

    Maintenance

  • Trading platforms

    Trading platforms

    TradingView

    MetaTrader 5

    MetaTrader 4

    CopyTrading

    Pepperstone platform

    cTrader

    Trading integrations

    Trading tools

  • Markets

    Markets to trade

    Forex

    Shares

    Indices

    Commodities

    Cryptocurrency

    Currency Indices

    Dividends for Index CFDs

    Dividends for Share CFDs

    CFD Forwards

    ETFs

  • Market analysis

    Market analysis

    Navigating Markets

    The Daily Fix

    Meet the Analysts

  • Learn to trade

    Trading guides

    CFD trading

    Copy trading

    Forex trading

    Commodity trading

    Stock trading

    Cryptocurrency trading

    Bitcoin trading

    Technical analysis

    Day trading

    Scalping trading

    Upcoming IPOs

    Gold trading

    Oil trading

    Webinars

  • Pepperstone Pro

  • Partners

  • About us

  • Help and support

  • English
  • 简体中文
  • 繁体中文
  • ไทย
  • Tiếng Việt
  • Español
  • Português
  • لغة عربية
  • Launch webtrader

  • Ways to trade

  • Trading platforms

  • Markets

  • Market analysis

  • Learn to trade

  • Pepperstone Pro

  • Partners

  • About us

  • Help and support

Analysis

GBP

July 2025 UK Inflation: Price Pressures Intensify Further

Michael Brown
Michael Brown
Senior Research Strategist
Aug 20, 2025
Share
This morning's UK inflation figures pointed to a further intensification in price pressures as the economy moved through the summer months.

Headline CPI rose 3.8% YoY in July, the fastest pace since January last year, albeit in line with the Bank of England's latest forecasts. Those same BoE forecasts, however, foresee a further rise in inflation in the months ahead, with CPI set to peak at 4.0% YoY in September, double the MPC's target.

Measures of underlying inflation also pointed to price pressures having remained intense, and incompatible with the Bank's 2% inflation aim. Core CPI, excluding food and energy, rose 3.8% YoY last month, the fastest pace since April, while the closely-watched services CPI metric rose 5.0% on an annual basis, also the highest level since April, and above the Bank's 4.9% YoY forecast.

Preview

Overall, the rise in headline prices came largely as a result of yet another chunky rise in food prices, but also by virtue of an upward impulse from consumer energy costs, with the Ofgem price cap this year seeing a much smaller drop than in July 2024, and as a result of the largest July increase in airfares since the start of the millennium. However, these one-off factors do little to allay concerns over those aforementioned underlying metrics remaining at elevated levels, though there may be some upwards skew in certain sections of the services metric, in particular, owing to the sampling having fallen in the middle of a number of major concert tours this summer.

Frankly, though, none of this is likely to move the needle especially much for the Bank of England, with the MPC having voted in favour of a 25bp Bank Rate cut a fortnight ago, by the narrowest possible 5-4 majority.

Today's figures are unlikely enough to persuade those 4 'hawks' that the risks of price pressures becoming embedded within the economy are subsiding in material fashion, though the next 'live' MPC meeting is now not until November, with the September meeting set to see Bank Rate held steady.

With the MPC having retained their guidance around a 'gradual and careful' pace of easing, my base case remains that a cut will be delivered at that November confab, given the continued preference for a regular, quarterly pace of cuts if possible. That said, the bar for further policy easing is clearly now considerably higher than it was mere weeks ago, while there also remains a long way to run until that November decision, especially with the autumn Budget, and likely sizeable fiscal tightening, in the mix during this period as well. 

The material provided here has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research we will not seek to take any advantage before providing it to our clients.

Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.

Other sites

  • The Trade Off
  • Partners
  • Group
  • Careers

Ways to trade

  • Pricing
  • Trading accounts
  • Pro
  • Active Trader program
  • Refer a friend
  • Trading hours

Platforms

  • Trading Platforms
  • Trading tools

Markets & Symbols

  • Forex
  • Shares
  • ETFs
  • Indices
  • Commodities
  • Currency indices
  • Cryptocurrencies
  • CFD Forwards

Analysis

  • Navigating Markets
  • The Daily Fix
  • Meet the analysts

Learn to Trade

  • Trading guides
  • Videos
  • Webinars
Pepperstone logo
support@pepperstone.com
1786 628 1209
#1 Pineapple House,
Old Fort Bay, Nassau,
New Providence, The Bahamas
  • Legal documents
  • Privacy policy
  • Website terms and conditions
  • Cookie policy
  • Sitemap

© 2025 Pepperstone Markets Limited | Company registration number 177174 B | SIA-F217

Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.

81.1% of retail investor accounts lose money when trading CFDs with this provider.

You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

You don't own or have rights in the underlying assets. Past performance is no indication of future performance and tax laws are subject to change. The information on this website is general in nature and doesn't take into account your or your client's personal objectives, financial circumstances, or needs. Please read our RDN and other legal documents and ensure you fully understand the risks before you make any trading decisions. We encourage you to seek independent advice.

Pepperstone Markets Limited is located at

#1 Pineapple House, Old Fort Bay, Nassau, New Providence, The Bahamas

and is licensed and regulated by The Securities Commission of The Bahamas,( SIA-F217).

The information on this site and the products and services offered are not intended for distribution to any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.