Inflation up to 3.8pc in June

The RPI measure also rose to 4.6pc, up 0.3 percentage points from May. Escalating food and fuel prices lay behind much of the hike in inflation, with further rises expected in the coming months. Analysts said the persistence of CPI inflation above the 2pc target reduced the prospect of interest rate cuts, despite the slowing economy. Charles Davis, economist at the cebr, said: "With the sharper than expected rise in inflation and the continued housing downturn a likely prelude to a significant consumer slowdown, these are difficult times for UK plc and decision makers in the monetary p...