Retail food inflation, which accounts for about 54 per cent of the consumer price index, rose 1.52 percent in August after prices contracted in the previous three months.
Clothing and footwear prices rose at the fastest pace since the CPI series began in 1997, up 4.6% annually in August.
Motor fuels were also pushing the overall cost of living higher, with fuels and lubricants rising 1.6 per cent month-on-month in August following a 1.3 per cent fall past year.
Early last month the Reserve Bank of India cut interest rates - making it the first Asian central bank to ease this year - on a subdued economic outlook.
According to data published by the Office for National Statistics (ONS) UK wage growth held at 2.1 per cent in July, falling below expectations that it would climb to 2.3 per cent.
Previously, the BOE said it expected inflation to hit 3% in October, something Tuesday's data suggest could happen in September.
"The Bank of England meets this Thursday to set monetary policy". It will be interesting to see whether any other members may do likewise given today's reading.
Commenting on the figures, Neil Wilson, senior market analyst at ETX Capital, said: "The inflation data builds a stronger case for the Bank of England to look at hiking rates but it is not yet strong enough for the MPC to act this week. United Kingdom 10-yr government bond yields have risen around 3bp, to 1.07%". "In addition, prices of onions, while still high, have retreated from the peak recorded in late-August". Consumer durables, too, contracted in July, by 1.3%, compared with a contraction of 2.1% in June.
"This suggests that the recent squeeze on consumer spending from higher inflation will continue to dampen growth in the United Kingdom economy in the second half of this year and next year".
The pound jumped to near year-highs against the dollar, a signal that some traders, at least, think that borrowing rates could be heading higher later this year or early next. Separately, the Reuters poll also predicted industrial output rose 1.2 per cent in July after contracting in June, despite disruptions caused by a new goods and services tax. The BoE has shown patience with above target CPI prints, however some reduction in the dovish bias and a move towards a more neutral or even a few hawkish comments is now expected by the market.