British consumer price inflation held steady in August, after unexpectedly strong rises in air fares, clothes and food prices offset falling fuel costs, official data showed today.
The Office for National Statistics said consumer price inflation came in at 3.1% last month in contrast to economists' expectations for a fall to 2.9%. On the month, inflation jumped by 0.5%, compared to a 0.2% fall in July and forecasts for a 0.3% increase.
The largest upward effect on CPI came from air transport, with fares rising at their fastest pace for a month of August on record. Clothing and footwear prices saw their sharpest August rise since 2001, with a big impact from the cost of women's outerwear at the start of the autumn season.
Seasonal discounting occurred earlier in 2010 than in previous years, adding to the upward pressure in August.
Food prices rose at their fastest annual pace since July 2009, with strong monthly rises in the cost of bread, cereals and vegetables.
UK producer price data earlier this month showed sharp increases in the cost of wheat due to drought in Russia pushing up global commodity prices.
The alternate retail price index measure, which has a longer history and includes more housing costs, was also higher than expected in August. The measure fell to 4.7% from 4.8% compared to expectations of a drop to 4.6%.
The figures are likely to be a concern to the Bank of England, which has blamed the rise of inflation above its 2% target largely on one-off factors such as sterling weakness and a rise in value-added tax at the start of the year.
Bank of England Governor Mervyn King had to write a public letter last month explaining why inflation had persisted above 3%.
