UK inflation rose to 3.8% in July, its highest level in 18 months, driven by soaring transport and food costs. This unexpected uptick from June’s figure of 3.6% has cast doubt on further interest rate cuts this year, despite the Bank of England’s recent decision to lower rates to 4%. Economists now predict inflation could peak at 4% in September, delaying monetary easing and complicating the government’s efforts to stimulate growth. The rise in services inflation, a key measure for the BoE’s rate-setting Monetary Policy Committee, to 5% has further intensified concerns about persistent price pressures.
Economists now predict inflation could peak at 4% in September, delaying monetary easing and complicating the government’s efforts to stimulate growth.
Contrary to earlier expectations of a summer slowdown, UK house prices have risen modestly, with the average house price climbing to £269,000, up 3.7% year-on-year as of June 2025 according to data from the Office for National Statistics. This uptick reflects a resilient market, buoyed by easing mortgage rates and tight housing supply. While on Monday Rightmove reported a seasonal dip in asking prices, down £4,969 in August to £368,740, actual transaction prices continue to trend upward. Analysts describe a “two-speed” market, sellers are adjusting expectations to attract buyers, but limited inventory and renewed demand are keeping final sale prices firm.
UK house prices have risen modestly, with the average house price climbing to £269,000, up 3.7% year-on-year as of June 2025 according to data from the Office for National Statistics
In corporate news, WH Smith’s share price plummeted over 40% on Thursday following the revelation of a £30mn accounting error in its North American division. The mistake, stemming from premature recognition of supplier income, led the company to slash its profit forecast for the region from £55mn to £25mn. Investors reacted swiftly, wiping over £500mn off the retailer’s market value. The stock now trades around 652p, down from a 52-week high of 1498p.
Our specialist's final thought
"Deloitte has been called in for a full review, and analysts warn the incident could tarnish WH Smith’s pivot to a travel-focused business model."
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