Inflation rises to 3.3%

Inflation is still above the Bank of England target. The Bank of England inflation target is more than a percentage point above the 2% goal. UK inflation rose by 0.01% between October and November to 3.3% under the Consumer Prices Index (CPI) following record price increases for clothing, furniture and food. The rate is well above the government's 2% target. The Retail Prices Index (RPI), which includes mortgage payments, rose to 4.7% from October's figure of 4.5%. Member of the Bank of England's Monetary Policy Committee Andrew Sentance warned that the CPI could increase to 4% next year as a result of the January VAT rise from 17.5% to 20%. He added that interest rates would need to rise correspondingly.

Inflation remains at 3.1%

The Consumer Price Index (CPI) has remained at 3.1% for the fourth consecutive month, according to the Office for National Statistics (ONS). However, the Retail Prices Index (RPI) which includes the cost of housing fell back slightly to 4.6%. Many experts believe that with predicted rises in food prices and the 2.5% increase in VAT planned for next January the cost of living will not ease. The price of clothing and footwear rose by 6.4% last month, marking the biggest recorded rise.

Interest rates to remain at 0.5% for 19th consecutive month

The Bank of England's Monetary Policy Committee (MPC) has decided to keep UK interest rates at the record low of 0.5% for the 19th month running. It will also stick with the £200 billion quantitative easing (QE) programme and, as of yet, has no plans to expand it further. Last month MPC member Andrew Sentance voted for a rate rise for the fourth consecutive month and fellow committee member Andrew Posen called for an expansion in QE - the policy of injecting money into the economy to increase the supply of money and prompt demand.