UK Inflation Hits 3.1% as Transport Costs Soar

UK's consumer price inflation rose to 3.1 per cent in August 2026, up from 2.9 per cent in July, according to data from the Office for National Statistics (ONS). The increase was driven by higher transport costs, with petrol and diesel prices rising significantly.

The average petrol price increased by 9.1 pence per litre between July and August 2026, reaching 161.3 pence per litre, the highest level since November 2022. Diesel prices rose by 14.2 pence per litre in August 2026 to 181.8 pence per litre.

Transport made the largest upward contribution to inflation, with no large offsetting downward contributions recorded. The CBI expects energy costs and passthrough to domestic prices to push inflation higher, while the Bank of England is likely to hold interest rates unchanged at its next meeting.