- UK inflation rose to 3.5% in the year to September from 3.1%, its fastest pace since October 2025, per the Office for National Statistics.
- Motor fuel prices rose 29.8% in the period covered by the figures, with petrol at 169.5p per litre and diesel at 192.5p per litre.
- UK government borrowing reached nearly £25bn in September, £1.8bn higher than a year earlier, as higher inflation raised debt interest costs.
- Conflicts in the Middle East and Ukraine, including Iran's effective closure of the Strait of Hormuz, have disrupted global oil supply and pushed up fuel prices.
- Chancellor John Healey delivers the Budget on 28 October, and Capital Economics expects a cautious Budget with little net impact on the economy.
Quotes
“We know that price rises from conflicts in the Middle East and Europe are hitting Britain and countries worldwide.”
“This reinforces our view that the Chancellor will deliver a cautious Budget on 28 October that has little net impact on the economy and leaves the toughest fiscal choices for next year”