The UK’s consumer price index (CPI) inflation rate for 12 months to August jumped to 3.1 per cent per cent, according to the latest data from the Office for National Statistics (ONS).
This is a slight jump from July’s 2.9 per cent rate and is attributed to a rise in transport costs, particularly motor fuels, towards the end of summer.
Today’s figure comes as a blow to Prime Minister Andy Burnham and Chancellor John Healey ahead of the latter’s Budget statement next month on October 28.
It also comes the day before the Bank of England’s next base rate update, with many analysts pricing in four hikes to the cost of borrowing over the next 12 months.
Inflation is on the rise again
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GETTYThe central bank’s Monetary Policy Committee (MPC) are expected by some economist to hike interest rates to four per cent tomorrow.
On the figures, ONS chief economist Grant Fitzner said: “Sharp price rises for petrol and diesel pushed inflation up again in August.
“Higher airfares, particularly for long-haul journeys, also contributed to the increase.”
The Chancellor added: “The war in the Middle East is impacting on inflation worldwide, not just here at home. In our bills, our weekly shop and at the petrol pumps.
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“We have taken early action to help families and businesses breathing space, by cutting tax on electricity bills, capping bus fares at £2 and lowering rates for pubs, social clubs and live music venues.
“Despite this serious global uncertainty, our UK economy is proving resilient, and our determination to deliver and growth in every postcode continues.”
Kevin Mountford, personal finance expert and co-founder of Raisin UK, shared: “Today’s rise in inflation to 3.1% will be unwelcome news for households already feeling the squeeze.
“Some 50 per cent of UK adults say their finances are under pressure, while 53 per cent have less money to spend freely than they did a year ago.
“With prices still rising and the Autumn Budget just weeks away, households are facing more financial uncertainty at a time when pockets are already stretched.
“The rise also makes a hold at the Bank of England’s next meeting more likely, as the MPC will want to see inflation moving back towards its two per cent target before considering further cuts.”