Consumer price index (CPI) inflation rose 3.1% in the 12 months to August, up from 2.9% the previous month, the Office for National Statistics (ONS) has revealed.

On a monthly basis, CPI inflation rose 0.5%, up from 0.3% the previous year.

The ONS said transport, particularly motor fuels, made the largest upward contribution, with the price of petrol increasing by over nine pence per litre between July and August to the highest average price recorded since November 2022.

This increase follows the ongoing conflict in the Middle East, which has driven up the price of oil.

Chief savings officer at Nottingham Building Society, Harriet Guevara, said the latest data may leave some families worried about finances.

She stated: "With recent energy and food cost increases still filtering through the system, and the US-Iran conflict spiking fuel costs again, it is understandable that many households may be feeling a little anxious.

"For savers, the challenge is that higher inflation erodes the real value of their cash, and knowing when to stick or twist on looking for a better savings deal becomes trickier given the prospects of interest rates also rising in the near future.

"It is therefore worth households looking at what their savings pots are there to do for them. Accessibility should be the priority for any money stored in case it’s needed at short notice, while for longer-term savings the rate of return will be a priority consideration."

The latest inflation data comes ahead of the Monetary Policy Committee’s Bank of England base rate decision tomorrow.

The central bank previously predicted that inflation would increase to 3.2% by the end of the year, before falling again in 2027.

Director of home moving strategy at Mortgage Advice Bureau, added that the latest data is a "poorly timed reading" for anyone hoping for a rate cut.

He concluded: "Two rises in a row makes a hold more likely tomorrow, with a hike unlikely but not impossible. Lenders will already have been adjusting their pricing in anticipation, not waiting for the announcement itself. If you're a first-time buyer with an offer on the table, that's a real reason to lock it in now rather than assume it'll still be there next week.

"The situation is similar for anyone remortgaging, but the stakes are higher. If your deal ends in the next few months, don't wait for tomorrow's decision to act. Lenders are already pricing in today's data, and the deals available right now might not still be there once the announcement lands.

"If you're moving home, don't put your plans on hold over this. Just make sure the numbers you're working from account for some potential movement in rates between now and when you complete - not just where you stand today."

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