UK Inflation Hits 3.1% as Transport Costs Soar

UK inflation rose to 3.1% in August 2026 from 2.9% in July, according to official data from the Office for National Statistics (ONS). The increase was driven by transport costs, particularly petrol and diesel prices, which saw significant jumps.

The average petrol price rose by 9.1 pence per litre between July and August 2026, reaching a high of 161.3 pence per litre, the highest level since November 2022. Diesel prices also increased, rising by 14.2 pence per litre in August 2026.

The CBI expects energy costs and their passthrough to domestic prices to further push up inflation over the coming months. However, the Bank of England's Monetary Policy Committee is likely to keep interest rates unchanged at its next meeting due to limited signs of a pick-up in domestic price pressures.