Trainline, Virgin Atlantic and Red Driving School investigated over 'drip pricing'
The UK’s competition watchdog has launched investigations into Trainline, Virgin Atlantic and Red Driving School, over concerns that all three companies displayed misleadingly low prices to their customers.
The Competition and Markets Authority’s probes are part of a broader clampdown on so-called “drip pricing”, an illegal practice that makes a product appear cheaper by not including all mandatory fees.
The regulator said it opened investigations into the companies amid concerns that customers had not been shown the total price upfront when buying train and coach tickets, holidays or driving lessons.
Emma Cochrane, executive director for consumer protection at the CMA, said:
The first price customers see should be the price they pay.
Clear pricing helps people compare offers confidently and choose the option that works best for them.
Unexpected mandatory charges make this much harder, which is why the CMA initially put these firms on notice over concerns about their pricing practices and is now opening formal investigations.
Trainline said in a statement to the stock exchange that it had “proactively engaged with the CMA over several months” and was “taking steps to enhance the presentation of certain fees”. Shares in the business, which is the only one of the three companies that is listed on the stock exchange, fell by as much as 14% in early trading on Wednesday.
Virgin Atlantic said that “mandatory fees are indicated at multiple stages” when customers are booking trips, but that it was reviewing the concerns and will cooperate with the regulator. Red Driving School was approached for comment.
The CMA’s investigations have been launched using its new consumer protection powers, which were granted last year.
OpenAI announces slowing pace of development after hack by rogue agent
OpenAI has said it has slowed down the pace of its AI development while it overhauled its research and training systems.
The company’s researchers were caught unaware last month when an AI agent under testing hacked another AI firm, Hugging Face.
The AI research lab behind ChatGPT said its new measures included pausing its model testing for two weeks and investing more in adding other AI systems to monitor the activities of AI agents in testing. Some of the company’s largest planned training runs remain on hold, the company said.
The company did not reply to questions about when the slowdown began or when it planned to return to its normal pace of development. However, in an interview with tech blog Sources News, Mia Glaese, who leads safety at OpenAI, said:
We are very far from everything running back to normal.
The company is working to ensure the AI model is responsive to human oversight and will behave as intended, a process called alignment, Sam Altman, the OpenAI CEO, wrote in the post announcing the slower pace of development.
We now require stronger evidence of aligned behavior throughout all of training, building on research and evaluations already underway. Keeping increasingly capable systems aligned is a challenge the whole field will need to address.
UK relies on heat-stressed countries for fruit and veg it could grow itself – report
The UK is vulnerable to food price shocks because of its dependence on imports of fruit and vegetable from countries even more exposed to the climate crisis, researchers say.
Much of Britain has sweltered under a record five heatwaves this year and endured drought and wildfires, with the hot, dry conditions damaging crops and reducing yields of domestic produce.
However, the UK relies on countries under even greater climate pressure for supplies of some of its most popular fresh foods, according to a report from the Food Foundation charity published on Wednesday.
While the UK generally produces enough grains, meat, milk and eggs to cover its needs, it has one of the lowest food self-sufficiency ratios among large western European countries.
Julian Jessop, independent economist and economics fellow at the Institute of Economic Affairs, a free-market think tank, said:
Market forces are helping to keep inflation in check, despite the headline rate jumping to 2.9%.
As expected, the bulk of the rise was driven by higher household energy bills following the increase in the Ofgem cap. Most other components were little changed, while food price inflation fell again, providing little support for claims that supermarket ‘price gouging’ is driving up grocery bills.
It is still too soon to sound the ‘all clear’. Inflation could rise further in the coming months as pipeline pressures feed through, and may not return to the Bank of England’s 2 per cent target until late next year. But subdued demand, strong competition and yesterday’s weak labour market data should reassure the Bank that the risks of second round effects are limited.
The best way to get inflation down is a combination of sound money and allowing market forces to do their job. Rather than constantly tinkering with individual prices, the government should free up markets to increase the supply of housing, food and energy – and reverse the many policies saddling businesses with additional costs.
Diesel and petrol prices fall in July along with European air fares
At least for now, lower diesel and petrol prices brought transport prices down in July.
Transport prices rose at an annual rate of 3.6%, down from 5.7% in June. Within this, motor fuel costs rose 15.5% year on year, down from 21.3% in June.
The average price of diesel fell by 8.8 pence a litre between June and July, compared with a smaller rise of 2.9p a litre last year. The average price was 167.6p a litre.
Petrol prices dropped 3.1p a litre against a rise of 2p a litre a year ago. The average price was 152.2p a litre.
Air fares rose 11.7% between June and July, compared with a rise of 30.2% between the same two months in 2025. The main reason was a 4.3% price fall on European routes, compared with a 38% rise last year. This is in contrast to long-haul flights, which went up 31.7% in price, more than last July’s 20.9% increase.
Regulated train fares in England could rise over 4% next year
Regulated train fares in England could increase by more than 4% next year.
The Office for National Statistics announced that inflation measured by the retail prices index (RPI) rose to 3.2% in July.
The government has not confirmed what it will do about fare increases in 2027, but last year’s 4.6% cap was one percentage point above RPI in July 2024.
If that formula is used to set next year’s increase, the cost of train travel will jump by 4.2%. That would mean an annual season ticket from Brighton to London rising by £219 to £5,423, according to PA.
A flexi ticket for travel two days per week over a year from Leeds to Manchester would increase by £151.35 to £3,754.95.
Keir Starmer’s government froze regulated fares this year.
About 45% of fares on Britain’s railways are regulated by the Westminster, Scottish and Welsh governments. They include season tickets on most commuter journeys, some off-peak return tickets on long-distance routes, and flexible tickets for travel around major cities.
Unregulated fares are set by operators, but increases are expected to be similar.
UK food prices rise at lowest rate since September 2021
Food and non-alcoholic drink prices rose at an annual rate of 1.3% in July, down from 1.7% in June – the lowest rate since September 2021.
The price of meat, particularly beef and breaded chicken, fell this year but rose last year.
Prices of vegetables fell more last month than they did last July, and prices of sugar, jam and honey rose less in July than they did last year.
Prices of fish rose but fell last year, while bread and cereals also became more expensive and were little changed a year ago.
Remarkably benign UK food prices keep a lid on inflation, said ING economist James Smith.
Headline inflation is up three-tenths of a percentage point to 2.9%, on the well-telegraphed rise in household energy bills and also a bigger rise in social rents than this time last year. That wasoffset by July’s short-lived dip in petrol and diesel prices (spoiler alert: that won’t last into August’s figures).
None of that was unexpected. What remains much more surprising, however, is just how benign food inflation is right now. Prices here were flat on the month, having fallen in month-on-month terms in the two prior readings, something that is highly unusual.
A quick glance at producer prices suggests consumer food inflation could theoretically even go negative in annual terms over the next few months. We’re not convinced that will happen – and it was always going to take at least a year for the full effects of the Iran War to show up here.
But it should still be welcome news for the Bank of England’s hawks, who point to the influential role of food prices in setting household inflation expectations.
Britain’s new prime minister Andy Burnham has pledged to ease cost of living pressures, and has already announced measures including a tax cut on household electricity prices and a cap on bus fares.
John Healey said in response to the latest inflation figures:
Iran war inflation continues to impact prices here at home, but Britain’s economy is resilient.
We have cut VAT on electricity bills and capped bus fares at £2 – to give breathing space to those feeling the strain.
There is more to do to restore hope and build a stronger economy where prosperity is shared more fairly across Britain.
Analysts expect inflation to rise further towards the end of the year as higher energy costs feed through to people’s bills, with no signs of progress on a deal to end the Middle East war. The US-Iran ceasefire expired on Monday.
The Bank of England held its benchmark interest rate at 3.75% last month even though inflation was above its 2% target.
Jonathan Raymond, investment manager at Quilter Cheviot, said:
A renewed spike in inflation has been expected as the war in the Middle East continues to navigate a clunky ceasefire.
Things remain far from normal in the Strait of Hormuz and look unlikely to be resolved any time soon, meaning pressure is likely to remain on prices for the remainder of the year at least.
July clothing prices affected by early discounting during June heatwave
Prices of furniture and household goods rose 1% year on year in July, compared with an annual fall of 0.2% in June, the UK’s statistics office said.
Prices of furniture and furnishings fell in July compared with June, but by less than a year ago. There were smaller upward contributions to infllation from tools and equipment for house and garden, and goods and services for routine household maintenance.
Clothing and footwear prices rose by 0.5% in July, compared with a fall of 0.5% the previous month. On a monthly basis, prices fell by 0.9% last month, the smallest July price drop since 2020.
The Office for National Statistics explained that discounting on clothing started earlier than usual this year in June, and that the quantity bought in clothing stores rose by 1.9%, the largest monthly rise since September 2025. People scrambled to buy summer clothes during the June heatwave, and retailers lured customers with sales promotions.
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JP Morgan warns rebound in UK inflation is 'warning shot for what could come next'
The UK’s core rate of inflation, which strips out volatile items such as energy, food and alcohol, stayed at 2.6% in July, while economists had expected it to dip to 2.5%.
Scott Gardner, investment strategist at J.P. Morgan Personal Investing, described the rebound in headline inflation as a “warning shot for what could come next”. He explained:
UK headline inflation jumped in July as the Ofgem energy price cap rise hit household bills. The increase was expected but marks a clear reversal from previous months when the headline rate was falling.
Until now, the spike in global energy prices had been felt the most among motorists when filling up their vehicles at the petrol pump. July data shows that the inflationary impact of the US-Iran war is spreading as rising energy costs feed through into higher household bills.
As the situation in the Middle East remains uncertain, the continuation of elevated energy costs remains the largest challenge for consumers and businesses. Petrol prices have already risen 6.3% in August compared to the previous month and will show up in next month’s reading. Businesses are also facing higher input prices which are being passed on to buyers and could rise heading into the colder months later this year. Falls in services inflation and shop prices are helping to offset some of these pressures for now but the jury is out on whether this will last.
While one data reading doesn’t always tell the whole story, this rebound in UK inflation is a warning shot for what could come next. We are keeping an eye out to see whether higher global energy prices have a knock-on effect for consumer goods prices, electronics and the wider artificial intelligence build out. This would have an impact on the UK economy and present a challenge for the Bank of England who are keen to avoid hiking rates. If goods inflation accelerates, then it will become difficult for BOE policymakers to maintain rates at the current level.
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Introduction: UK inflation increases in July, driven by pricier gas; oil prices rise again
Good morning, and welcome to our rolling coverage of the global economy, the financial markets, the eurozone and business.
It’s UK inflation day!
Inflation picked up to 2.9% last month, mainly driven by higher gas prices.
The annual increase in the consumer prices index in July compares with a rate of 2.6% in June, according to the Office for National Statistics. City economists had forecast a rate of 2.9%.
Housing and household services, and furniture drove up the inflation rate while transport made the largest, partially offsetting, downward contribution, the statistics office said.
Within housing, higher gas prices were the main factor: Prices rose by 14.7% in July compared with a fall of 7.2% a year ago. Britain’s energy regulator changed the energy price cap, leading to higher standard variable tariffs, and estimated that for an average household paying by direct debit for dual fuel, this equated to an annual bill of £1,862, a rise of £221.
The increase was the largest rise in gas prices since October 2022, when UK consumers were first exposed to the higher prices arising from the energy crisis relating to Russia’s war in Ukraine. The price rise means that gas prices are at their highest level since March 2024.
The news comes after British consumers faced the sharpest summer increase in energy charges in four years in July as the US-Israel war on Iran sent shock waves through global energy markets.
However, separate official figures on Tuesday showing a slowdown in the jobs market – including a slowdown in private sector pay growth – may mean that the Bank of England won’t need to hike interest rates, according to economists.
Crude oil prices have risen this week as a ceasefire between the US and Iran expired on Monday, with Brent crude up 0.65% to $91.61 a barrel this morning.
In Asian stock markets, Japan’s Nikkei has slumped again, by 3%, following a chip sell-off on Wall Street. South Korea’s Kospi plunged 5.9% and China’s Shenzhen exchange lost 4.7%.
The Agenda
9.30am BST: UK Private rents and house prices for July
8.10am BST: European Central Bank president Christine Lagarde speaks
10am BST: Eurozone inflation final for July
7pm BST: US Federal Reserve minutes of last meeting
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