Petrol prices push up inflation
December 15, 2009
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.
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.
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