21:46, 12-Sep-2017
UK Economy: UK CPI up 2.9%, PPI up 3.4%; renewed pressure on BoE
[]
Share
Copied
British inflation hit its highest level in more than five years. That will make explaining the decision of not increasing interest rates more difficult for the Bank of England.
Official data shows the consumer price index increased by 2.9 percent in August compared with a year earlier. The rise is driven by clothing and fuel prices. The bigger-than-expected rise in the index comes ahead of the BoE's next announcement on interest rates on Thursday.
The BoE targets 2 percent inflation. But most of its policymakers are expected to vote once again to keep rates at all time low as Britain prepares for the challenge of leaving the European Union in 2019. Meanwhile, the producer price index rose by an annual 3.4 percent. It is the first increase since February.