BCC: “inflation warning lights continue to flash” as July figures rise
BCC: “inflation warning lights continue to flash” as July figures rise
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The British Chambers of Commerce (BCC) has warned that persistent inflation is piling pressure on UK businesses after the latest figures from the Office for National Statistics (ONS) showed price rises accelerating in July.
Inflation rose to 3.8% in the year to July, the highest since January 2024, which is thought to be largely driven by air fares rising during the summer holidays.
According to the ONS data, inflation increased at a faster pace than expected last month, marking the sharpest rise since the beginning of 2024. Analysts had forecast a slowdown, but the figures suggest that inflation remains far from the Bank of England’s 2% target.
Reacting to the release, Stuart Morrison, Research Manager at the BCC, said: “The inflation warning lights continue to flash, with July’s rate being slightly higher than most analysts had forecast. Prices are now rising at the fastest rate since the start of 2024, with little sign that inflation will be near the Bank’s target of 2% anytime soon.
“Our surveys show inflation remains a real concern for over half of SMEs. Businesses tell us national insurance, wage growth and tariffs are all bubbling away in a cauldron of price pressures. While many firms are desperate to see further interest rate cuts, there’s now growing concern that persistent inflation will limit the scope for further reductions.
“It’s vital that policymakers ease the cost pressures on business. Our message to the Chancellor is clear – no new tax rises on business in the Budget. Firms can’t drive forward economic growth if they are continuing to face cost pressures from several directions.”
The warning comes as businesses continue to grapple with higher wage demands, tax liabilities and ongoing global trade costs. The BCC said it will use the upcoming Budget to push for policies aimed at easing the burden on small and medium-sized enterprises, which it argues are being squeezed from “several directions” by rising costs.
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