The Consumer Prices Index (CPI) grew by 2.9% in the year to June 2013, up from 2.7% in May.
This means it is at its highest level for over a year.
The Office for National Statistics (ONS) said the largest upward contributions to the change in the rate came from motor fuels and clothing & footwear. The largest downward contribution came from air transport.
CPIH, the new measure of consumer price inflation including owner occupiers’ housing costs, grew by 2.7% in the year to June 2013, up from 2.5% in May.
The slower growth in CPIH than CPI is due principally to owner occupiers’ housing costs increasing more slowly than overall inflation for other consumer goods and services in the year to June.
Vince Smith-Hughes, retirement spokesperson at Prudential, said: “The rise in inflation will have a major impact on households throughout the UK. However, pensioners will be amongst the hardest hit since they spend higher proportions of their income on essentials like food and fuel, which are seeing the biggest price rises.
“The combined effects of falling retirement incomes and inflationary pressures make pensioners amongst the most financially vulnerable. This year, the average expected income for those in retirement hit a six-year low of £15,300, which is 18% down on 2008.
“When making any financial plan for the future, it’s vital to take into account the impact of inflation, particularly if you’re choosing an annuity. It’s best to start by contacting a financial adviser or retirement specialist, who will be able to set out the best options for protecting income against inflation in retirement.”
