UK inflation hits 3.5% and borrowing rises to £25bn ahead of Budget

Briefing by News4U · First published 2026-10-21 23:06:03 UTC

September figures show inflation and borrowing both at one-year highs, driven by fuel prices and debt costs, ahead of John Healey's first Budget.

UK inflation rose to 3.5% in the year to September, up from 3.1%, while government borrowing reached £25bn, £1.8bn higher than a year earlier, according to the Office for National Statistics. [1] [2] [3]

Petrol prices rose 8.2p per litre to 169.5p and diesel to 192.5p, pushing motor fuel prices up 29.8%. National debt topped £3 trillion for the first time. [2] [3]

The figures illustrate the chancellor's challenge ahead of the October 28 Budget, balancing cost-of-living pressures with rising debt interest and spending. [1] [2] [3]

Sources

1. UK government borrowing rises to £24.5bn ahead of Budget

   Financial Times · 2026-10-21 06:10:16 UTC · Summary only

2. Inflation and government borrowing highest for a year ahead of next week's Budget

   BBC Business · 2026-10-21 06:21:02 UTC · Full text

3. Faisal Islam: Inflation and borrowing figures illustrate chancellor's Budget challenge

   BBC Business · 2026-10-21 10:20:15 UTC · Full text

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