Surging Fuel Prices Push UK Inflation Rate to 3.5% Ahead of Budget
BBC News reports on the rising inflation rate in the UK, which reached 3.5% in the year to September, up from 3.1% previously. This increase is primarily attributed to sharp rises in petrol and diesel prices, with the cost of filling up a vehicle soaring in recent months due to ongoing conflicts in the Middle East and Europe that have squeezed global oil supplies.
Key Points:
- Inflation Rate: The Office for National Statistics (ONS) reported a 3.5% inflation rate, the highest since October 2025.
- Fuel Prices: Petrol prices in September reached their highest since August 2022, while diesel prices also rocketed. Motor fuel prices overall rose by 29.8% in the period covered by the figures.
- Borrowing Figures: UK government borrowing jumped to nearly £25 billion in September, adding pressure on Chancellor John Healey as he prepares for his first Budget.
- Global Factors: The wars in the Middle East and Ukraine have contributed to elevated fuel prices, with the effective closure of the Strait of Hormuz by Iran and global attacks on oil refining capacity.
- Budget Preview: Healey acknowledges the impact of global conflicts on prices and promises a Budget that will "keep up this momentum" while adhering to fiscal rules and promoting economic growth.
- Political Reactions: The Conservatives criticize Labour's handling of the economy, while the Shadow Chancellor Andrew Griffith calls for Healey to use the Budget to address the deficit and reduce the cost of living for families.
"This reinforces our view that the Chancellor will deliver a cautious Budget... that leaves the toughest fiscal choices for next year." - Ruth Gregory, Capital Economics.