British Inflation Rises to 3.1 Percent With Motor Fuels Up 23 Percent
British consumer prices rose 3.1 percent in the year to August, up from 2.9 percent in July, the Office for National Statistics said on 16 September. Core inflation did not move at all, holding at 2.6 percent for a second month, and services inflation held at 3.4 percent. The entire acceleration sits in the volatile half of the basket.
Motor fuels rose 23.0 percent on the year, against 15.5 percent the month before. Average petrol reached 161.3 pence a litre, the highest since November 2022, and diesel 181.8 pence.
One division, more than a fifth of the rate
Transport contributed 0.69 percentage points of the 3.1 percent headline, which is more than a fifth of the whole rate from 1 of 12 divisions, on our calculation. Transport prices rose 4.6 percent on the year against 3.6 percent in July, and 1.5 percent in the month against 0.4 percent in the same month of 2025.
The monthly pump moves are the sharpest comparison the release offers. Petrol rose 9.1 pence a litre between July and August against 0.3 pence in the same two months of 2025, and diesel rose 14.2 pence against 0.8 pence. Diesel rose roughly 1.6 times as fast as petrol in the month and the gap between the two fuels now stands at 20.5 pence a litre, on our calculation.
| Measure | July 2026 | August 2026 |
|---|---|---|
| CPI, annual | 2.9% | 3.1% |
| Core CPI, annual | 2.6% | 2.6% |
| CPI services, annual | 3.4% | 3.4% |
| CPI goods, annual | 2.2% | 2.7% |
Consumer price inflation, United Kingdom, August 2026, published by the Office for National Statistics on 16 September 2026. Core excludes energy, food, alcohol and tobacco. The goods rate in August was the highest since September 2025. The release records that the Bank of England was granted exceptional pre-release access to an estimate of these data at 10:00 on Monday 14 September, for a Monetary Policy Committee meeting held that day.
Food is now pulling the other way
Food and non-alcoholic beverage inflation held at 1.3 percent, a rate last lower in September 2021. On the broader CPIH measure its contribution has fallen to 0.11 percentage points from a recent high of 0.46 a year earlier, a swing of 0.35 points working against the rate, on our calculation. Sugar, jam, syrups, chocolate and confectionery are the clearest example: that class ran at 11.9 percent as recently as October 2025, 2.5 percent in July, and 0.6 percent now.
Housing pushed the other way. Owner occupiers’ housing costs rose 3.9 percent from 3.7 percent, and their contribution to the broader CPIH measure rose to 0.68 percentage points, a third consecutive monthly rise after 16 consecutive falls. Electricity, gas and other fuels contributed 0.15 points, the most since September 2025.
Against its neighbours, Britain is running hotter. Its 3.1 percent compares with flash estimates of 2.9 percent in Germany and 2.7 percent in France, gaps of 0.2 and 0.4 percentage points, on our calculation.
Why it matters: The Bank of England targets this number, and two important measures of underlying pressure did not accelerate. Core held at 2.6 percent, services held at 3.4 percent, and the rise came from fuel prices set in a global market. An economy whose domestically generated price pressure is flat and whose imported energy cost is not presents a different problem from one where both are rising.
Outlook: The annual fuel rate now turns on the 2025 base as much as on the pump: with prices flat it can ease or firm according to what fuel prices did in the matching months of last year, which this release gives only for August. Further rises in crude and refined product prices would push the other way. The retail prices index ran at 3.4 percent in August.
Sources: Office for National Statistics.
