Annual consumer price inflation jumped to 2.7 percent in October from 2.2percent the previous month,according to official figures released Tuesday - dampening prospects that the Bank of England will move to stimulate the economy in the short term, at least.
The data from the Office for National Statistics reflected increases in university tuition fees and in food prices but did not take into account some of the latest increases in energy bills, which look set to push the headline inflation figure up yet higher in coming months.
Inflation remains an Achillesheel of the British economy.
Unlike its neighbors inside the euro, Britain saw its currency fall significantly onworld markets after the financial crisis, only to import inflation as the exchange rate pushed up the prices of non-British goods.
Rising commodity prices and increases in the value-added tax, a sales tax, have also played their part in pushing up British inflation, which hit a peak of 5.2 percent in September.
The inflation data complicatethe picture for the Bank of England, which has cut interest rates to a record lowof 0.5 percent and spent £375 billion, or $593 billion,on purchases of financial assets to try to stimulate anemic growth. Last week the bank decided to keep rates and the asset-buying program, known as quantitative easing, on hold.
The rise in inflation is likely to strengthen the hand of members of the Bank of England's monetary policy committee who are resisting more stimulus, according to a note from Steven Bryce, European economics analyst at Credit Suisse.
