Consumer prices in the US increased in line with economists’ estimates in July, reflecting higher prices for accommodation, food, energy and new vehicles, a Labour Department report released on Wednesday showed.

The consumer price index increased by 0.5 per cent last month after climbing 0.9 per cent in June, the report showed. In the 12 months through July, the index advanced by 5.4 per cent.

The drop in the month-on-month inflation rate was the steepest in 15 months. The data could provide some support to Federal Reserve officials who have repeatedly said that the current burst in inflation is temporary and likely to fade in the coming months.

Meanwhile, the UK economy saw a robust recovery in the second quarter as the easing of coronavirus restrictions boosted consumer spending, the first quarterly estimates from the Office for National Statistics showed on Thursday.Gross domestic product grew 4.8 per cent sequentially in the second quarter, reversing a 1.6 per cent fall in the first quarter.

The rate matchedeconomists’ expectations. The growth in the second quarter was close to the five per cent pace the Bank of England had predicted last week.

Notwithstanding the recent growth, the British economy remained 2.2 per cent smaller at the end of June than it was in February 2020, before the pandemic struck the country, a reminder of the huge hit dealt by Britain’s long coronavirus lockdowns last year.

In Germany, the inflation rate was at its highest in over 27 years in July, largely due to the low base of comparison, data published by Destatis revealed on Wednesday.

Consumer prices increased by 3.8 per cent on a yearly basis in July, faster than the 2.3 per cent seen in June. Food prices advanced by 4.3 per cent in July and services costs grew by 2.2 per cent. The core inflation rate, which excludes volatile items such as food and energy, came in at 2.7 per cent.

“The sudden base effect occurring in July 2021 had been expected as the tax reduction had been passed on to consumers a year ago, involving price decreases for many products,” said Christoph-Martin Mai, head of the consumer prices section at Destatis.

This report was compiled by Bank of Valletta for general information purposes only.