Fuel Prices Drive UK Inflation to 3.1%
UK's consumer price inflation rose to 3.1% in August 2026, up from 2.9% in July, according to data from the Office for National Statistics (ONS). This marks a second consecutive month of increased inflation.
The main contributor to this rise was transport costs, which increased by 4.6% over the past year. Within transport, air fares rose by 6.2%, driven by long-haul routes. Motor fuel prices also saw a significant increase, rising by 23% in the past year and reaching the highest level since November 2022.
The average petrol price increased by 9.1 pence per litre between July and August, while diesel prices rose by 14.2 pence per litre. As a result of these fuel price increases, Martin Sartorius, CBI's lead economist, warned that inflation is likely to continue rising due to escalating tensions in the Middle East.
Not everyone shares this view, however. Harvir Dhillon, lead economist at the British Retail Consortium, pointed out that retailers have managed to shield their customers from some of the cost pressures by offering competitive prices and deals on staple items like olive oil and coffee.