UK inflation accelerated sharply in September, piling pressure on the Bank of England to raise interest rates and arriving at an uncomfortable moment for Chancellor John Healey, whose maiden budget lands next week.
The Consumer Prices Index (CPI) rose by 3.5% in the 12 months to September 2026, up from 3.1% in August, according to figures from the Office for National Statistics (ONS).
The reading is the highest since October last year and significantly above the Bank of England's 2% target.
The broader Consumer Prices Index including owner occupiers' housing costs (CPIH), considered the most comprehensive measure of inflation, rose to 3.6% from 3.3% in August.
Surging fuel prices were the biggest single driver of the increase.
Petrol rose by 8.2 pence per litre between August and September, taking the average price to 169.5 pence, the highest recorded since August 2022.
Diesel climbed by 10.7 pence per litre over the same period to an average of 192.5 pence, the highest since July 2022.
Motor fuel prices were up 29.8% in the 12 months to September, compared with a rise of 23.0% the previous month.
Core CPI, which strips out volatile energy, food, alcohol and tobacco prices and is closely watched by monetary policymakers, rose to 2.8% from 2.6% in August.
Services inflation, another key metric for the Bank of England, rose to 3.7% from 3.4%.
The UK's inflation rate now sits above those of its nearest European neighbours, with France recording 3.4% and Germany 3.3% in September.
The data put the Bank of England in a difficult position, with persistent price pressures making the case for higher rates even as the economy remains fragile.
The figures also arrive at a sensitive moment politically, giving Healey's critics fresh ammunition ahead of a budget expected to involve significant tax rises and borrowing.
Food price inflation held steady at 1.3%, though industry body the Food and Drink Federation has warned that food inflation will arrive later and persist for longer as higher costs work through the supply chain.
