Official figures show that inflation in Britain spiked up to 2.9% in the year to August, more than anticipated in the markets.

The Office for National Statistics said Tuesday that the increase from the previous month’s 2.6% rate was largely due to rising prices for clothing and motor fuels.

The scale of the increase was not expected — the consensus in the markets was that inflation would increase to 2.8%.

Inflation is now well above the Bank of England’s target of 2%, so that’s likely to stoke speculation that the central bank may raise interest rates sooner rather than later to keep a lid on price pressures in the economy. However, policymakers are expected to keep interest rates on hold at their meeting on Thursday.

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