|
|
UK inflation hits 14-month high
UK inflation rose to 3.5% in January, representing the fastest annual rise in 14 months, figures from the Office for National Statistics (ONS) have revealed.
The Consumer Prices Index (CPI) was largely driven up by the return of VAT to 17.5% in January, together with a continued increase in oil prices.
Meanwhile, the Retail Prices Index (RPI), which includes housing costs, also rose from 2.4% to 3.7% in January.
The news means that the governor of the Bank of England, Mervyn King, will have to write a letter of explanation to Chancellor Alistair Darling.
The Bank of England had anticipated the increase, but has also predicted that inflation will fall to 1.8% towards the end of the year.