The UK inflation rate remained flat at 3% in January, according to the Office for National Statistics (ONS), beating expectations of a drop to 2.9%.
Consumer Price Inflation (CPI) came in unchanged on the previous month after a fall in oil prices was offset by prices for cultural goods and services, according to the ONS.
In December, inflation fell to 3% from November’s five-year high of 3.1%, its first drop since June 2017.
Inflation has been climbing steadily since the beginning of last year but many have predicted it has peaked at around 3%. However, concerns about rising inflation, albeit particularly in the US, have caused market wobbles since the end of January as investors worry about the impact of central banks tightening monetary policy.
The Bank of England (BoE) had expected inflation to fall back from 3% and in last week’s monthly Monetary Policy Committee meeting the minutes said a rate rise would be needed “somewhat earlier” in order to return inflation to its 2% target.
With inflation remaining at 3% last month it increases the likelihood of a rate hike in May.
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