UK Inflation Accelerates to 3.1% in August
London, September 16 (QNA) – UK inflation accelerated to a five-month high of 3.1% in August from 2.9% in July, driven largely by higher motor fuel and airfares, official data showed on Wednesday, putting inflation further above the Bank of England’s 2% target.
The reading was in line with economists’ expectations but exceeded the Bank of England’s forecast of 2.8% for August, published in July. The data came a day before the central bank is widely expected to keep interest rates unchanged at its policy meeting.
Sterling edged lower after the data were released.
The rise in headline inflation was largely driven by transport costs, particularly motor fuels, according to the Office for National Statistics. The ONS said sharp increases in petrol and diesel prices pushed inflation higher, while higher airfares, particularly for long-haul flights, also contributed.
However, underlying price pressures showed little change. Core CPI inflation, which excludes energy, food, alcohol and tobacco, held at 2.6% in August for a fourth consecutive month, while services inflation remained at 3.4%. Services inflation is closely watched by the Bank of England as an indicator of domestic price pressures and wage-related inflation.
Official data released on Tuesday showed wage growth remained subdued, with regular pay growth at 2.9% in the three months to July, close to its lowest level since 2020. (QNA)
