Double blow to Healey as inflation rises to 3.5% and monthly deficit hits £24bn

Fuel prices have been on the rise since the US and Israel’s war on Iran began in February. Photograph: Bryn Colton/Getty Images

Inflation surged to 3.5% last month while the government deficit was a worse-than-forecast £24.5bn, in a double dose of bad news for John Healey before next week’s budget.

The Office for National Statistics said annual inflation rose from 3.1% in August, overshooting City forecasts of a rise in the consumer prices index (CPI) to 3.4%, as a result of the surging cost of fuel.