Highest inflation in four months means Budget must tackle squeeze on business

Scott Knowles (Credit: East Midlands Chamber)

The upcoming Autumn Budget must be more supportive of business to mitigate pressure on firms, East Midlands Chamber has said, after latest data showed inflation has risen sharply to 2.9% – the highest level in four months.

The latest estimated inflation figure from the Office for National Statistics covers the 12 months to July 2026, up from 2.6% in June.

East Midlands Chamber Chief Executive Scott Knowles said: “Inflation going the wrong direction – rising again and moving further away from the Bank of England’s 2% target – should sound an alarm bell for the Chancellor ahead of the Autumn Budget on 28th October.

“2.9% inflation is too high, negatively impacts investment decisions, and signals the need for measures in the Budget to be fully supportive of business growth.

“With the ongoing impact of the Middle East conflict, rising inflation had been widely anticipated. That’s no good for business confidence at a time when trading conditions are already tough going.

“Inflation tops the list of concerns that were reported by East Midlands firms in our Quarterly Economic Survey for Q2 of this year so seeing it soar again is another blow for business, especially when you consider the many other challenges firms face.

“Whether business rates that disproportionately impact manufacturers, hospitality and small businesses, or high energy costs, conditions remain tough. These pressure points are among several key areas we have identified in our landmark publication The Framework for Growth – as needing to be urgently addressed by policymakers.

“The Chancellor has a clear opportunity on 28th October to alleviate this immense high pressure on business and unlock growth. Measures announced in the Budget that day must fully support business and create a landscape that allows businesses to thrive, to stimulate investment and create jobs.”