UK inflation rise dampens hopes for December interest rate cut by Bank of England

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A larger than anticipated surge in inflation last month has essentially dashed hopes of a December interest rate cut by the Bank of England. Economists had predicted that rising energy costs would push inflation beyond the Bank's two per cent target last month, but an unexpected increase in services and core inflation, which excludes fluctuating food and fuel costs, could pose a problem for those setting rates.

Core inflation increased from 3.2 per cent to 3.3 per cent, surpassing the consensus prediction of a drop to 3.1 per cent, while services inflation rose from 4.9 per cent to five per cent. This unexpected turn of events will likely pressure the Bank of England to adopt a more cautious approach to reducing interest rates as the UK braces for the

 link source - Business Live News

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