UK inflation accelerated sharply in September 2026, reaching its highest level since October 2025 as rising fuel prices increased pressure on British consumers.
According to figures released Wednesday by the Office for National Statistics (ONS), the Consumer Prices Index (CPI) rose 3.5% annually, compared with 3.1% in August.
Consumer prices increased 0.4% month over month, exceeding economists’ expectations of a 0.3% rise. This followed a 0.5% monthly increase in August, while prices had remained broadly unchanged in September 2025.
Transport costs, particularly petrol and diesel, were the main drivers of higher inflation. Meanwhile, restaurants and hotels helped offset some of the increase.
UK Fuel Prices Drive Inflation Higher
Rising energy and transportation expenses played a significant role in September’s inflation figures.
Average petrol prices climbed 8.2 pence per litre between August and September, reaching 169.5 pence per litre, their highest level since August 2022.
Diesel prices increased even more sharply, rising 10.7 pence per litre to an average of 192.5 pence. This marked the highest level since July 2022.
Overall, motor fuel prices surged 29.8% annually in September, accelerating from a 23.0% increase in August.
The broader transport category recorded annual inflation of 6.6%, compared with 4.6% the previous month.
Air travel also contributed to the upward pressure. Although airfares declined 19.5% between August and September, the decrease was smaller than the 28.8% drop recorded during the same period in 2025.
European flight prices experienced a particularly modest seasonal decline, contributing to higher annual transport inflation.
Core UK Inflation Climbs to 2.8%
Underlying inflation measures also showed renewed price pressures across the British economy.
Core CPI inflation, which excludes volatile food, energy, alcohol and tobacco prices, increased to 2.8% annually in September.
The figure matched economists’ forecasts but exceeded August’s 2.6% reading.
Meanwhile, the broader Consumer Prices Index including owner occupiers’ housing costs (CPIH) rose 3.6% annually, up from 3.3% in August.
Monthly CPIH inflation reached 0.4%, compared with just 0.1% in September 2025.
Core CPIH, which excludes the same volatile categories as core CPI, increased to 3.1% from 2.9%.
These figures suggest that inflationary pressures extended beyond energy markets, affecting several parts of the UK economy.
Goods, Services and Housing Costs Continue Rising
Annual goods inflation accelerated to 3.2% in September, compared with 2.7% in August.
This represented the highest reading since September 2023, with energy-related products, including motor fuels and kerosene, accounting for much of the increase.
Services inflation also strengthened, rising to 3.7% from 3.4% in the previous month.
Housing and household services costs increased 4.5% annually, up from 4.3%.
Owner occupiers’ housing costs were a major contributor, advancing 4.0% over the year compared with 3.9% in August. On a monthly basis, these costs rose 0.6%.
The figures highlight persistent price pressures affecting housing, household expenses and essential services.
Food Inflation Remains Subdued as Hotel Prices Ease
Despite rising energy and transportation costs, food inflation remained relatively contained.
Food and non-alcoholic beverage prices increased 1.3% annually in September, unchanged from August.
This was the lowest annual food inflation rate since September 2021, when it stood at 0.8%.
On a monthly basis, food prices declined 0.2%, matching the decrease recorded a year earlier.
Meanwhile, inflation in restaurants and hotels slowed to 3.8%, compared with 4.1% in August.
Hotel accommodation costs were primarily responsible for the slowdown. Hotel prices increased 2.3% during September, compared with a 3.8% rise in the corresponding month of 2025.
This provided some relief to the overall inflation figures, partially balancing the stronger increases in transport and energy costs.
UK Inflation Exceeds France and Germany
September’s figures also showed that British inflation remained elevated compared with major European economies.
The UK’s 3.5% annual CPI inflation rate exceeded the reported readings of 3.4% in France and 3.3% in Germany.
Meanwhile, the UK’s Retail Prices Index (RPI), another measure of inflation, increased 3.9% annually.
The latest figures highlight the continuing challenges facing the British economy as rising fuel prices and persistent services inflation increase household living costs.
The renewed acceleration in UK inflation could also complicate the Bank of England’s monetary policy outlook, particularly if higher energy costs continue influencing consumer prices over the coming months.
For households and businesses, future fuel prices and the persistence of underlying inflation will remain important factors to monitor.
