Inflation hits 2.9% as fuel and clothing costs grow


There has been a bigger-than-expected jump in the rate of inflation, to 2.9 per cent last month, aided by a Brexit-related leap in clothing costs.

According to figures from the Office for National Statistics (ONS), fashion costs rose at an annual rate of 4.6 per cent in August, reports Sky News.

It attributed the increase to the fall in the value of the pound since the EU referendum which has forced up prices for imported goods – costs which are evidently being passed on to shoppers.

The number crunchers also pointed to upwards pressure from rising fuel prices.

The headline inflation figure of 2.9 per cent represented an increase from 2.6 per cent in the previous month and was higher than most forecasters had predicted.

The data helped sterling to its highest level against the dollar for almost a year – trading at $1.3267.

It is because the higher inflation figure is seen by markets as making a UK interest rate rise more likely.