PRIME minister Sir Keir Starmer was on the back foot defending his economic record today after official figures showed inflation rising more than expected.

In the latest instalment of bad news on the economy, the Office for National Statistics revealed that prices rose by 3.6 per cent in the year to June, up from 3.4 per cent the month before.

In response, TUC general secretary Paul Nowak urged a cut in interest rates, saying: “High rents, energy, petrol and water bills mean many workers are struggling to keep their heads above water.

“The global uncertainty impacting the economy is showing no signs of settling down. But workers should not be bearing so much of the brunt.

“It’s time the Bank of England stepped in to deliver a 0.5 per cent cut to interest rates. 

“This will ease pressure on households, put more money into people’s pockets, and help families get back on their feet.”

And Chancellor Rachel Reeves, while looking resolutely cheerful throughout Prime Minister’s Questions in the Commons, conceded things were not going well.

“I know working people are still struggling with the cost of living,” she said.

“There is more to do and I’m determined we deliver on our Plan for Change to put more money into people’s pockets.”

The inflation rise is the third in a row and comes when experts had been expecting the rate to stay flat.

Instead, it is now at a near-18 month high, driven by energy and food cost increases above all.

In the Commons, Tory leader Kemi Badenoch sought to press her advantage, saying Labour should be ashamed of its record.

She said: “The economy is contracting, inflation highest in the G7, unemployment up every month under this government, spending out of control, borrowing costs more expensive than Greece. And this is just the first year.”

The greater-than-expected inflation rise could make it less likely that the Bank of England will cut interest rates in the medium term, although a short-term reduction is still expected.

Suren Thiru, economics director at Institute of Chartered Accountants, said: “June’s uptick is the start of a slight summer surge in inflation with skyrocketing business costs and global trade turbulence likely to lift the headline rate moderately higher by the autumn, despite July’s drop in energy bills.