London Daily

Focus on the big picture.
Tuesday, Jun 02, 2026

UK inflation jumps to 2.5% as secondhand car and food prices rise

UK inflation jumps to 2.5% as secondhand car and food prices rise

June figure is highest level since August 2018 and above analysts’ forecasts

Britain’s inflation rate has risen to 2.5% – the highest in almost three years – as a combination of supply shortages and rising demand prompted by the easing of coronavirus lockdown restrictions led to higher prices last month.

The Office for National Statistics (ONS) said dearer food, secondhand cars, clothing, footwear and fuel were the main factors behind a jump in the annual inflation rate from 2.1% to 2.5% in June.

The figure was the highest since the 2.7% recorded in August 2018, higher than the 2.2% expected by analysts, and above the Bank of England’s 2% target.

Core inflation, which strips out food, energy, alcohol and tobacco, rose from 2% to 2.3%, also above the expert consensus.

Threadneedle Street policymakers have said they expect rising inflation to be temporary and have signalled it will not trigger an early increase in interest rates from their record low of 0.1%.


According to the ONS, part of the increase in inflation as measured by the consumer prices index was caused by the bounceback in prices after they were depressed during lockdown.

There were also sharp rises in the cost of secondhand cars (up 5.6%) because the supply of new vehicles has been affected by a global shortage of computer chips.

Rising oil prices led to a sharp increase in motoring costs. The annual inflation rate for motor fuels stood at 20.3% in June, the highest since 2010, after an increase in average petrol prices from 106.5 pence a litre to 129.7 pence a litre over the past 12 months.

Other contributors to rising inflation included furniture (up 6.6%), women’s clothes (4.3%), bicycles (13%), books (8%) and vet bills (4.2%).

Jonathan Athow, the deputy national statistician for economic statistics at the ONS, said: “The rise was widespread, for example coming from price increases for food and for secondhand cars where there are reports of increased demand.

“Some of the increase is from temporary effects, for example rising fuel prices which continue to increase inflation, but much of this is due to prices recovering from lows earlier in the pandemic. An increase in prices for clothing and footwear, compared with the normal seasonal pattern of summer sales, also added to the upward pressure this month.”

Samuel Tombs, the chief UK economist at the consultancy Pantheon Macroeconomics, said businesses were seeking to take advantage of strong consumer demand after the relaxation of Covid-19 restrictions.

“The rise in the core rate in June was driven by increases in clothing inflation to 3.0%, from 2.1% in May, and catering services inflation to 2.2%, from 1.4%. In addition, a jump in secondhand cars inflation to 5.5%, from 0.9%, boosted the headline rate by 0.08 percentage points.”

Britain is not alone in experiencing stronger price pressures during a period marked by strong post-lockdown growth. Earlier this week the US reported that its inflation rate had hit a 13-year high of 5.4%. Analysts expect further increases over the coming months before it starts to come down again.

Yael Selfin, the chief economist at KPMG UK, said: “While a combination of factors could push inflation further above the Bank of England’s 2% target, as many businesses continue to grapple with rising costs and supply chain shortages, we expect it to peak at around 3% by the end of this year.

“The prospects of cooling inflationary pressures next year, as firms adjust to new levels of demand, should provide the Bank of England with room to keep interest rates unchanged for a while longer.”

Sanjay Raja, a senior economist at Deutsche Bank, believes price spikes will be transitory and expects CPI to peak at 3.9% in November.

Bridget Phillipson, the shadow chief secretary to the Treasury, said businesses were struggling to access the supplies and the staff they needed, leading to shortages and higher prices.

“The government must do all it can do to keep materials and other supplies moving to prevent shortages, including cutting the unnecessary red tape following the EU-UK agreement, and providing much better training so that we have access to the skills we need here in the UK,” she said.

Newsletter

Related Articles

0:00
0:00
Close
Japanese Technology Firm Fujitsu Launches Advanced Artificial Intelligence Tool for Corporate Disclosures
South Africa Officially Launches Nationwide Campaign for Highly Contested Local Government Elections
United Kingdom Commits Additional Funding for Unexploded Ordnance Clearance in Laos
Singapore Announces Stringent New Greenhouse Gas Regulations for Commercial Cooling Systems
Cambodia and Thailand Hold High-Level Border Security Talks at United Nations Headquarters
Myanmar Military Government and China Sign Major Agreement to Upgrade Media and Cultural Cooperation
Knife Attack at Swiss Train Station Leaves Three Injured in Suspected Act of Domestic Terrorism
Transnational Extortion Gang Threatens Canadian Police With Army of One Thousand Armed Operatives
Australia Imposes Forty-Two-Day Quarantine on Cruise Ship Passengers Following Deadly Hantavirus Outbreak
International Monetary Fund Unlocks Seven Hundred Million United States Dollars for Sri Lanka Following Economic Reforms
Australia Launches Record One Point Four Billion Dollar Lawsuit Against Chemical Giant 3M Over Contamination
China and Canada Foreign Ministers Meet in Ottawa in Effort to Stabilize Strained Diplomatic Ties
Indonesia Demands Urgent United Nations Security Council Reform Amid Escalating Global Conflicts
Extreme Weather Patterns Trigger Severe Drought in Madagascar and Destructive Flooding in East Africa
Indian State of Karnataka Faces Political Upheaval as Chief Minister Siddaramaiah Abruptly Resigns
Philippines and Japan Reaffirm Defense Ties as Crucial for Indo-Pacific Regional Stability
Norway Joins French Nuclear Deterrence Initiative in Major Shift for European Security Architecture
Global Critical Mineral Alliances Expand as Western Nations Move to Counter Chinese Supply Dominance
United States Imposes Fifty Percent Tariffs on Mexican Steel and Aluminum Ahead of Trade Pact Review
European Union and China Head Toward Major Trade Conflict Over Clean Technology Exports
United States Economic Growth Severely Downgraded to One Point Six Percent as Stagflation Fears Mount
World Health Organization Warns Central African Ebola Epidemic is Outpacing Containment Efforts
United States Treasury Department Conditions Sanctions Relief on Reopening of the Strait of Hormuz
Iranian Air Defenses Intercept and Destroy United States Military Drone Over Bushehr Province
Iranian Armed Forces Launch Ballistic Missiles Toward Unspecified Targets Prompting Regional Condemnation
United Nations Secretary-General Warns Global Order Facing Highest Level of Conflict Since 1945
Israel Issues Sweeping Evacuation Orders in Southern Lebanon Amid Intensified Hezbollah Conflict
Russia Announces Systemic Military Strikes Targeting Ukrainian Defense and Energy Infrastructure
United States and Iranian Negotiators Reach Draft Agreement to Extend Ceasefire and Resume Nuclear Talks
United Nations Security Council Deeply Divided Over United States Capture of Venezuelan President
US and Iran Exchange Direct Military Strikes Amid Fragile Gulf Ceasefire
World Health Organization Warns of Catastrophic Ebola Outbreak in DR Congo
Russia Threatens New Wave of Strikes on Ukrainian Infrastructure and Embassies
Scientists Warn Atlantic Ocean Currents Could Collapse Faster Than Projected
Anthropic Reaches $900 Billion Valuation in Historic AI Funding Round
Washington Imposes Crippling Sanctions on Iranian Maritime Authority
Japan and the Philippines Initiate Strategic Intelligence-Sharing Pact
Microsoft Deploys Autonomous Computer-Using AI Agents to Global Markets
Anthropic Secures $45 Billion Compute Infrastructure Agreement With SpaceX
U.S. Director of National Intelligence Resigns Amid Administration Shakeup
Micron Technology Crosses Trillion-Dollar Valuation Amid Unprecedented Hardware Demand
Canada and Germany Finalize Historic Long-Term LNG Export Agreement
China Expands International Travel Restrictions on Domestic AI Researchers
Japan Approves Sweeping Overhaul of National Intelligence Apparatus
Global Airlines Scramble Logistics as Middle East Airspace Remains Fractured
Japan's Naphtha Imports Plunge 47 Percent Amid Strait of Hormuz Closure
Global Crude Prices Retreat Below $96 as Gulf Tensions Momentarily Ease
Generative AI Outperforms Human Baselines in Landmark Global Creativity Study
NASA Partners With Private Aerospace to Unveil Permanent Lunar Base Architecture
South Korean Equity Markets Surge on Next-Generation Memory Chip Frenzy
×