Britain's inflation rate rose more than expected last month and above the central bank's 2 per cent target for the first time since June amid higher petrol and food costs, official data showed today.
The Office for National Statistics (ONS) said consumer prices rose 0.5 per cent in October, taking the annual rate up to 2.1 per cent from 1.8 per cent in September. Analysts had predicted a 1.9 per cent annual rise.
With food and energy prices still rising and factory gate inflation at a 12-year high, there is a risk that inflation will climb further, and the figures are likely to dent expectations that the Bank of England is about to cut interest rates.
The central bank held borrowing costs at a six-year high of 5.75 per cent last week and will publish on Wednesday its new quarterly inflation forecasts.
Many analysts expect an interest rate cut to 5.5 per cent early next year given a weaker outlook for the economy in the wake of financial market turbulence.
The ONS said the chief culprit for the rise in inflation was higher petrol costs, which added 0.29 percentage points to the annual rate. Food price inflation, particularly meat and fruit, added 0.12 percentage points.
Since October, oil prices have neared $100 a barrel, and wheat prices have remained high.