UK inflation rise makes it clear: the cost of living crisis has not gone away
For anyone hoping the Bank of England will pick up the pace of interest rate cuts – including Rachel Reeves – there was little comfort in the inflation data,The consumer prices index increased at a higher than expected rate of 3,6% in June, the Office for National Statistics (ONS) revealed,That remains in line with the Bank of England’s expectation of an inflation “hump” over the summer; but the upward pressure is not just confined to the regulated prices, such as transport fares and utility bills, that policymakers knew would rise,Motor fuels are the main factor behind the upward shift in CPI from 3.
4% in May, according to the ONS.The price of a litre of petrol is not rising – it fell by 0.5p between May and June.But it was plunging this time last year, so the smaller monthly decline puts upward pressure on inflation.There were a number of other drivers, too, including a 7.
9% jump in air fares between May and June.The ONS has said the price of a flight always tends to increase in June as the summer season starts, but this was the fastest such increase since 2018.Food prices have also continued to be strong, rising at an annual rate of 4.5% – the fastest since February last year.The ONS cites price rises for several foods, including cakes and cheddar.
The costs of furniture and household goods made their largest contribution to inflation since December 2023.In other words, the jump in inflation does not seem to be a one-off quirk, but reflects price pressures across a range of goods and services.The “core” rate, excluding volatile fuel, food, cigarettes and alcohol, rose to 3.7% in June, from 3.5% in May.
Given the Bank was predicting that headline inflation would peak at 3.7%, this reading seems unlikely to blow an August rate cut off course, with markets still putting the probability of a reduction at that meeting at 83%.But the members of the monetary policy committee (MPC) who would like to pick up the pace of cuts may struggle to win others over without more signs of weakness.As Ian Stewart, the chief economist at Deloitte, put it: “Inflation is expected to fall back towards the end of this year, but in the meantime the pressure on the Bank of England will be to keep interest rates higher for longer.”Continued high inflation is unlikely to do much for consumers’ mood, either, underlining the sense that the cost of living crisis has never quite gone away.
Sign up to Business TodayGet set for the working day – we'll point you to all the business news and analysis you need every morningafter newsletter promotionThe independent MPC member Catherine Mann suggested in an interview on Tuesday that the sheer unpredictability of prices could be contributing to caution about spending,“The prices of things have changed so much and are variable so that you don’t know exactly how much you are going to need to get you to the end of the month,” she told the Business in Wales website,“People are keeping a little bit of a rainy-day fund or a little bit of a savings buffer,For example, they’re putting off taking that vacation or that holiday that they until they can get a sense of what their finances are,”Strong real wage growth in recent months may have helped – something Reeves highlighted in her Mansion House speech on Tuesday.
But households are unlikely to be feeling particularly upbeat if, as Mann says, they are not sure where the next painful price rise is coming from.
Future British & Irish Lions tour of France on the agenda at Melbourne summit
A British & Irish Lions tour of France could move a step closer next week when executives hold talks over “a new business model” in Melbourne before the second Test of the series against Australia.Abdel Benazzi, the vice-president of the French federation (FFR), held informal discussions with Lions executives in Dublin before the warm-up match against Argentina, and he will travel to Australia next week to further press his nation’s claims of facing the touring side again, having previously done so in 1989. France have emerged as leading contenders to face the Lions in a warm-up match before the tour of New Zealand in 2029 and, according to Benazzi, could also fulfil the same role before the inaugural women’s tour in 2027, also to New Zealand.More recently, however, there has been a groundswell of support for a tour of France, with leading Top 14 sides such as Toulouse and Bordeaux offering the prospect of competitive warm-up matches before a mouthwatering series against Les Bleus in contrast to the currently one-sided tour of Australia. The former Wales scrum-half Mike Phillips last week became the most recent former Lion to throw his weight behind the prospect, suggesting a tour of France would be a “gamechanger”
Cherished champion and statesman: Usyk focuses on Ukraine before titles
On Monday afternoon, in central London, Oleksandr Usyk looked resplendent on an open-topped black bus as he prepared to send loaded messages to Daniel Dubois, Vladimir Putin and Donald Trump. High in the air he held three fingers on his right hand to signify his intention to become a three-time undisputed world champion. It was a typical sporting gesture and underlined his determination to defeat Dubois at Wembley Stadium on Saturday night and follow his earlier achievements in winning all the belts as a cruiserweight and then, last year, becoming the first boxer to unify the world heavyweight division this century.Usyk remains the WBA, WBC and WBO champion but boxing politics forced him to vacate his IBF title soon after he beat Tyson Fury in their magnificent first world title unification fight 14 months ago in Riyadh. He looks ready now for the dangerous challenge of Dubois, the new IBF champion, but Usyk’s arrival in London was a timely reminder of the far more significant role he plays in Ukraine
Electric Archer lights up India classic to justify Test return for England
The electric return of Jofra Archer in England’s tight victory against India at Lord’s set straight a couple of narratives that arose during his four-year absence from Test cricket. It is often said that a player’s stock can rise when they are sat on the sidelines – yet sometimes, in some quarters, the reverse can also be true.Chief among them was a reminder that England possess a special fast bowling talent here, Archer displaying the attributes that set him apart from others. As the man himself confidently put it regarding the 89.6mph beauty to Rishabh Pant that angled in, nipped away and gave the snappers the stumplosion they craved: “I guess it was just a matter of when, if I kept bowling like that
Onley and Blackmore lead the charge of young Britons at Tour de France
For more than a decade, the interest in British riders racing in the Tour de France was focused on familiar names – Mark Cavendish, Chris Froome and Geraint Thomas – but now a new generation of English-speaking talent is making its mark on the world’s biggest race.Ben Healy, West Midlands-born but with Irish heritage, has been the revelation of the Tour so far, and was fully rewarded for his unrelenting efforts with the yellow jersey of race leadership on the Bastille Day stage to Puy de Sancy.Healy was briefly a teammate to Tom Pidcock as a teenager before shining as an under-23 rider. Success in the “Baby Giro” in Italy drew him to the attention of the American team, EF Education-EasyPost.More than his results, Healy’s approach to racing, free of the risk-averse tactics of some predecessors, is refreshing and exciting
England call up veteran spinner Liam Dawson to replace Bashir for fourth Test with India
Liam Dawson has been added to England’s squad for the fourth Test against India, ending an eight-year exile from the longest format in international cricket.Last month the Hampshire all-rounder made a successful return to England’s T20 side after a three-year absence and, with Shoaib Bashir forced to pull out of the India series with a broken finger, he has finally been rewarded for his excellent red-ball form in recent seasons: 49 first-class wickets in 2023 followed by 54 in 2024, by a considerable margin his two most successful campaigns.In nine matches this summer Dawson has taken a comparatively sober 21 wickets while the most successful spinner in the top flight, with 32, is Jack Leach, who has been overlooked despite still being on an England and Wales Cricket Board central contract. Dawson has also been preferred to Rehan Ahmed, Will Jacks and Tom Hartley, all spinners who have played Tests for England in recent years.The 35-year-old is a much better batter than Bashir or Leach, with a first-class average this summer of 44
Hundred sell-off saved up to six counties from possible collapse, new report finds
The windfall generated by the sale of shares in the eight Hundred franchises may have saved as many as six first-class counties from imminent crisis and possible collapse, according to an expert in sport finance who co‑wrote a new report into county cricket.The Leonard Curtis cricket finance report analysed the 18 first-class counties over a decade, identifying a “yawning gap” between the most successful clubs – with Surrey by some distance the most profitable – and the less well-off. Of the £306.1m generated in 2023 just three teams – Surrey, Lancashire and Warwickshire, with income boosted in all three cases by hosting Ashes Tests that year – were responsible for 44%. By contrast the three poorest counties – Leicestershire, Derbyshire and Northamptonshire – between them generated just 5
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