Annual inflation rose to 3.8% in July, up from 3.6% in June and above forecasts, with core inflation also increasing to 3.8% from 3.7%. Air fares surged 30.2% between June and July, the largest monthly rise since 2001. Petrol rose by 2p per litre and diesel by 2.9p month‑on‑month. Restaurant and hotel prices increased due to a rise in last‑minute overnight bookings. The hospitality and night‑time economy face sharply higher input costs for food, energy, and transport, squeezed margins, potential job losses, and business closures, prompting calls for policy support to sustain viability and employment.
"Today's inflation figures, with prices rising to 3.8 per cent in July, underscore the relentless pressure on the UK's night-time economy. Hospitality and night time economy businesses are facing sharply higher costs for food, energy, and transport at a time when margins are already wafer-thin. After years of cost-cutting, the sector has reached its limit. There is very little left to trim without impacting quality, service, and staff levels."
"Many operators have already squeezed margins, streamlined staffing, and absorbed costs wherever possible. Some input costs are rising sharply month-on-month, leaving businesses with little room to manoeuvre without impacting quality or service. This persistent inflation threatens to impact the night-time economy further, which is still attempting to rebound from the pandemic and subsequent cost pressures. Policymakers need to recognise that sustained price rises do not only hit households but also the very businesses that underpin vibrant city centres and cultural life."
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