The UK’s rate of consumer price inflation (CPI) remained at 2.2% in the year to August, unchanged from July, according to the latest data.
The monthly report from the Office for National Statistics (ONS) showed that lower prices for petrol and diesel, and restaurants and hotels, were offset by a big rise in air fares.
It comes the day before the Bank of England’s next interest rate decision.
While the headline CPI figure held steady, core inflation — which excludes volatile elements such as energy and food — rose from 3.3% in July to 3.6% in August. Services sector inflation also increased, from 5.2% to 5.6%.
Yael Selfin, chief economist at KPMG UK, said that the rise in services inflation “likely closes the door on an interest rate cut tomorrow”.
The base rate currently stands at 5% after a cut from 5.25% at the start of August.
Most economists believe a further reduction is likely at the next meeting in November.
