The Office for National Statistics show prices in the UK were 2.6% higher in July year-on-year.
The ONS put the rise down to higher air fares and housing costs.
It’s the first time since March that the Consumer Price Index has risen.
The Retail Prices Index (RPI) annual inflation stands at 3.2% in July 2012, up from 2.8% in June. The largest upward pressures on the change in the RPI rate came from the purchase of cars, air fares, clothing & footwear and housing. The only significant downward pressure came from household goods.
The CPI inflation rate has fallen from a peak of 5.2% in September mainly driven by a drop in fuel prices due to a weak global economy.
"Any increase is disappointing," said a Treasury spokesperson.
"The government knows how tough things are for families at the moment and that is why we have reduced income tax, and frozen both council tax and fuel duty."