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Petrol prices push up inflation | |
(10 minutes later) | |
UK inflation picked up pace in November, driven largely by higher petrol prices, official figures show. | UK inflation picked up pace in November, driven largely by higher petrol prices, official figures show. |
The consumer prices index (CPI) rose faster than expected to an annual rate of 1.9%, compared with 1.5% in October. | |
November's rate was the highest since May this year. Inflation is forecast to rise further next year when the VAT discount ends. | November's rate was the highest since May this year. Inflation is forecast to rise further next year when the VAT discount ends. |
The retail prices index (RPI), which includes housing costs, rose to 0.3% from a rate of -0.8% in October. | |
Average petrol prices rose by 2.9p to 108.3p a litre in November - compared with a record fall of 9.3p this time last year. | |
The Bank of England has a CPI target of 2%. The Bank expects the index to rise above that in the new year after VAT reverts to 17.5%. | |
If CPI inflation rises above 3% the Bank's governor, Mervyn King, must write to the chancellor to explain why. | |
However, the Bank expects inflation to slow later in the year. |