Annualised inflation remained stable at 2.2% in August, aligning with forecasts, but core inflation increased to 3.6%, driven largely by soaring air fares and transport prices.
Nicholas Hyett noted that core inflation's rise was unexpected, reflecting significant air fare increases of 22.2% month-on-month, marking the second largest spike since 2001.
While consumers experienced some relief from slowing fuel and alcohol price increases, air fare surges kept services inflation high at 5.9% year-on-year.
The rise in core inflation poses challenges for the Bank of England regarding interest rates, delicately balancing between economic stability and inflationary risks.
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