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numbers Bank Rate3.75%held 17 SepCPI inflation, Aug3.1%next figure 21 OctPetrol, 28 Sep173.46pa litreBudget28 Oct Next rate decision5 Nov 

Checked 29 Sept 2026 · how

2% target 4.2%

Lead story / Week of 28 September 2026

The Bank of England now expects inflation to reach about 4.2% in early 2027

On 24 September Clare Lombardelli, a member of the Bank of England's Monetary Policy Committee, said the Bank's latest near-term forecast has CPI inflation rising from 3.1% now to around 3.7% in the last three months of 2026, and to around 4.2% in the first three months of 2027. That is "materially higher" than the Bank expected in July. She pointed to the global energy shock from the conflict in the Middle East.

By Kinza 3 min read Facts checked 29 Sept 2026

Chart of the week

Government borrowing this year: £8.1bn above forecast

£20bn £40bn £60bn £80bn £8.1bn above forecast Apr May Jun Jul Aug

Borrowing is the gap between what the government spends and what it takes in from taxes and other income. This chart adds it up month by month since the financial year started in April, next to the Office for Budget Responsibility's March forecast. By the end of August the government had borrowed £77.3 billion, £8.1 billion more than forecast. The Budget, with a new OBR forecast, is on 28 October.

View the data
Date Borrowed so far OBR forecast (March)
April 2026 £23.4bn £20.9bn
May 2026 £43.3bn £38.6bn
June 2026 £57bn £54.9bn
July 2026 £59bn £54.4bn
August 2026 £77.3bn £69.2bn

Source

Interview question of the week

Borrowing is £8.1 billion above forecast and the Budget is on 28 October. What can the Chancellor do?

say your answer out loud first

Show a strong answer

Start with the three levers: taxes, spending and borrowing. For each one, say who pays and when. Raising taxes brings money in, but someone ends up with less to spend. Cutting spending means choosing which services or payments get less. Borrowing more adds to the debt, and interest on it was £8.8 billion in August alone, the highest August figure in cash terms since monthly records began in 1997. It also helps to know why borrowing is above forecast: the OBR says the gap was driven by spending on benefits and debt interest. A strong answer ends with what you would watch: the OBR's new forecast, published with the Budget on 28 October.

Budget questions test whether you can see trade-offs, not whether you can guess the Chancellor's plan.

Sources

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dates that matter

What's coming up

  1. Ofgem

    Energy price cap rises 4%

    For a typical household paying by direct debit, the cap goes from £1,663 to £1,723 a year for October to December. Ofgem says higher wholesale gas prices caused by the conflict in the Middle East are behind the rise.

    Ofgem announcement

  2. HM Revenue and Customs

    VAT on home electricity cut to 0%

    In England, Scotland and Wales, from 1 October 2026 to 31 March 2027. Gas and other home fuels stay at 5%, and Northern Ireland's rate does not change.

    GOV.UK policy paper

  3. Money in 3 Minutes

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  4. at 18:00

    UCAS

    UCAS early deadline: Oxford and Cambridge

    Applying for 2027 entry to Oxford or Cambridge, for economics, maths or anything else? The whole application has to be in by 6pm. Most other courses have until 13 January 2027.

    More

    UCAS uses the same 15 October deadline for most courses in medicine, veterinary medicine and science, and dentistry, which is why its page lists them together.

    UCAS deadline page

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What's coming up

UCAS deadlines, inflation figures and Bank Rate decisions, each with its date and a link to the source.

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Blog

CPI 3.1% CPIH 3.3%

22 Sept 2026 · 3 min

I nearly got inflation wrong this week

CPI and CPIH sit side by side in the same ONS release. How I almost put the wrong one in a headline, and the habit that caught it.

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