Commenting on the latest ONS inflation data, Kevin Brown, savings expert at financial mutual Scottish Friendly, says
“Everyday expenses remain stubbornly high for many (1). With inflation now gaining momentum again, today’s rise will likely be another worrying development for households already dealing with elevated living costs.
“When prices rise faster, household budgets have less room to absorb other costs and wages do not stretch as far. The Bank of England will take that into account ahead of its next interest rate decision tomorrow (2).
“Today’s reading supports policymakers who believe interest rates need to be higher (3). Although wage growth is not accelerating (4), data released yesterday showed the labour market remains subdued.
“And even though higher interest rates cannot directly bring down externally driven energy price rises (5), another rise in inflation leaves the Bank with much less room to look past those pressures and increases the risk that borrowing costs stay higher for longer.
“The possibility for consumers that both living costs and borrowing costs remain elevated makes building a financial buffer, reviewing savings rates, and considering longer-term investing where finances allow all the more important.”
Source (1): https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/consumerpriceinflation/july2026
Source (2): https://www.bankofengland.co.uk/monetary-policy-report/2026/july-2026
Source (3): https://www.cityam.com/bank-of-england-predicted-to-raise-interest-rates-this-year/
Source (5): https://www.reuters.com/business/bank-england-set-hold-rates-steady-slow-qt-2026-09-14/