Inflation figures 'won't affect interest rates'

The higher-than-expected rise in inflation recorded for November is unlikely to have a major impact on interest rates, it has been argued.

Vicky Redwood, UK economist at research consultancy Capital Economics, made the point after the Office for National Statistics (ONS) revealed that the consumer price index rate stood at 1.9 per cent.

She suggested that the rise is probably due to temporary factors - petrol price rises in particular - and the Bank of England’s Monetary Policy Committee will probably not be influenced by it to a large extent.

’The further slight pick-up in core inflation is a bit more worrying, but given the spare capacity in economy, we don’t think that that is going to continue,’ Ms Redwood added.

According to the ONS, the largest upward pressure on inflation - which rose from the 1.5 per cent recorded in October - came from transport and fuels in particular.
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