The Consumer Price Index (CPI) for October showed the rate of annual inflation jumping from September’s 1.8 per cent to 2.1 per cent. The bulk of the increase was due to rising petrol prices, but there was also a substantial upward movement in the price of food, particularly meat and also in the price of strawberries and bananas. This contributed to a rise in the Retail Price Index where inflation rose to 4.2 per cent, against 3.9 per cent in September.

Jonathan Loynes, chief European economist at Capital Economics, said: “Retail margins will have to be squeezed tightly to prevent core goods inflation from edging higher over the coming months.” He added that on the basis of continuing prices rises “interest rates may not fall for a while yet.”