UK inflation climbs to 3.5%: what is rising fastest

The Office for National Statistics (ONS) reports that the Consumer Prices Index (CPI), the main measure of inflation, rose 3.5% in the 12 months to September 2026, up from 3.1% in August. Prices rose 0.4% in the month alone.

The other measures

The wider CPIH index, which also includes owner-occupiers' housing costs, was 3.6%. Core CPI — which strips out energy, food, alcohol and tobacco — rose to 2.8% from 2.6% a month earlier. All three are well above the Bank of England's 2% target.

What is rising fastest?

The main driver is transport. Motor fuel is up 29.8% over the year, from 23.0% in August. Petrol averaged 169.5 pence a litre and diesel 192.5 pence — the highest levels since 2022. Air fares also pushed prices up.

In the CPIH index the biggest contribution came from housing and household services: owner-occupiers' housing costs rose 4.0% over the year, and heating kerosene (used by homes off the gas grid) was up 22.7%.

What held inflation back?

The main offsetting factor was restaurants and hotels, where hotel prices rose more slowly than a year earlier. Food and non-alcoholic drink inflation stayed modest at 1.3%, unchanged from August.

What it means for households

Rising prices hit budgets directly, especially for those who drive a lot, as fuel is rising fastest. For those on benefits or a pension, remember that yearly uprating is usually linked to inflation, but with a lag.

How to protect your budget

There are a few practical steps. Check you are not overpaying for energy: comparing tariffs and fixing a deal can save a noticeable amount. Review subscriptions and regular payments you no longer use. If you drive, cheaper filling stations and price-comparison apps help with dearer fuel. And plan big purchases where you can, rather than buying on impulse.

Why it matters for interest rates

Inflation shapes the Bank of England's decisions. It was this pick-up that led the Bank to raise Bank Rate to 4% on 4 November. The next inflation figures are due from the ONS on 18 November and will show whether prices kept rising in October.

Why the figures matter

Inflation is not an abstraction: the CPI is used to uprate many benefits, tax thresholds and contract prices. Knowing the latest figure helps you see how much dearer life has become over the year and whether your income has really grown. If your pay rose by less than 3.5%, in real terms it fell, even if it went up on paper.