UK inflation fell to its lowest level in more than a year last month, but small business owners should read the number for what it is: a snapshot of a June that has already been overtaken by events.
Figures published by the Office for National Statistics on Wednesday showed inflation cooled to 2.6 per cent on an annual basis in June, down from 2.8 per cent the previous month. City economists had forecast 2.7 per cent. It was the lowest reading since March 2025.
The driver was fuel. Diesel fell by 10.7p to 176.4p per litre between May and June, and petrol dropped 2.1p to 155.3p, after the United States and Iran signed a memorandum of understanding to stop fighting for 60 days and global oil prices slid.
For any firm running vans, plant or a delivery fleet, that was a genuine reprieve. It may also prove a short one. Fighting resumed in July and oil has jumped by around a fifth in the past month, which is likely to push inflation back up in the second half of the year.
Grant Fitzner, chief economist at the ONS, said: “A fall in motor fuel prices, particularly diesel, helped ease inflation in June.”
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