Investing.com - UK inflation rose again in January, albeit at a slightly slower than expected rate as the Brexit-fuelled drop in sterling continued to push up the cost of living.
Consumer prices rose 1.8% compared with a year earlier, the Office for National Statistics said, slightly below economists' expectations for a 1.9% rise and up from 1.6% in December.
Consumer prices fell 0.5% in January from a month earlier, in line with economists’ expectations.
Earlier this month, the Bank of England said it sees inflation running at 2% this year, slightly higher than its previous forecast of 1.8% made in its November inflation report.
The BoE expects inflation of 2.7% next year, which is well above its target rate of 2%.
Much of the increase inflation is the result of the weaker pound, which is making imported goods more expensive.
Retail price inflation rose by 2.6% in January compared with the same month in 2015.
Excluding oil prices - which have risen sharply in recent months - and other volatile components such as food, core consumer price inflation was 1.6%, compared with economists' expectations for 1.8%.
Data on factory gate prices underscored the inflationary pressures in the pipeline.
Output prices rose 3.5% against forecasts of a 3.2% increase, while prices paid by factories for materials and energy jumped by 20.5%.
GBP/USD was at 1.2491 from around 1.2519 ahead of the release of the data, while EUR/GBP was at 0.8497 from around 0.8480 earlier.