“These figures suggest that inflation is in a difficult phase as stronger services sector price pressures helped keep the headline rate frustratingly above the Bank of England’s 2% target in August.
“The direction for UK inflation over the rest of this year looks largely locked in, with the boost to demand from a growing economy and higher energy bills in October likely to put inflation on a modest upward trajectory.
“While the increase in services inflation confirms that it remains a key barrier to keeping the headline rate consistently at or below target, the growing squeeze on wages should help put it on a firmer downward path.
“An interest rate cut on Thursday is looking unlikely with the majority of the Monetary Policy Committee likely to want to assess the impact of next month’s budget before deciding when to loosen policy again.”
ENDS
Notes to editors:
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