UK Inflation Picks Up in June, Fuel Prices in Focus

Inflation in the UK picked up pace in June 2025, largely due to a rebound in fuel prices.

The Consumer Prices Index including owner occupiers’ housing costs (CPIH) rose by 4.1% year-on-year, a slight increase from 4.0% in May. On a monthly basis, CPIH rose 0.3%, compared to 0.2% in the same month last year.

The standard Consumer Prices Index (CPI) showed a similar trend, climbing to 3.6% annually, up from 3.4% in May. Monthly CPI growth also reached 0.3%, higher than the 0.1% gain recorded in June 2024.

Fuel Pushes Inflation Up, Housing Eases Pressure

The main driver behind the rise in both CPIH and CPI was the transport sector, with motor fuel prices playing a key role in pushing inflation higher. On the other hand, housing and household services, particularly owner occupiers’ housing costs, helped to slightly offset the overall upward pressure on CPIH.

Core Inflation Signals Underlying Tensions

Core inflation also edged higher, showing persistent price pressures:

Core CPIH (excluding energy, food, alcohol, and tobacco) rose to 4.3%, up from 4.2% in May.

• Within this, goods inflation accelerated from 2.0% to 2.4%
• Services inflation dipped marginally from 5.3% to 5.2%

Core CPI increased to 3.7%, compared to 3.5% the previous month.

• Goods inflation climbed from 2.0% to 2.4%
• Services inflation remained unchanged at 4.7%

With fuel prices adding fresh momentum and goods inflation gaining traction, the data signals that price pressures remain broad-based. While housing costs provided some relief, the overall inflation outlook continues to demand close attention.

Source: Office for National Statistics