UK inflation jumps to 3.1% in August as fuel prices rise

Britain's annual inflation rate reached 3.1 percent in August, up from 2.9 percent in July, according to official figures published by the Office for National Statistics. The reading came in as economists had expected, with fuel costs pushed higher by the Middle East war, Business Recorder reported.

The pressure falls on Prime Minister Andy Burnham and finance minister John Healey, who must ease household living costs before the government's budget update next month. The Bank of England is expected to keep its benchmark rate at 3.75 percent on Thursday, while the US Federal Reserve is also expected to raise borrowing costs after the European Central Bank did so last week.

Healey has pledged strict fiscal discipline but has not said whether his October 28 budget will include new tax increases. Analysts anticipate further price increases before year-end as higher energy costs pass through to bills, and an agreement to halt the conflict looks distant. Richard Carter of Quilter Cheviot said the figures were a setback for a government that has made easing living costs its main priority.