CPI increases by 8% as price inflation notches up 4%

“Gulp….”

Not entirely unexpectedly, the CPI inflation measure rose to 4% according to today’s ONS dats. This is double the Bank of England’s target, and bound to raise pressure on the bank’s MPC to raise interest rates.

Of these two numbers, the retail figure at 5% is the most concerning, reflecting as it does Britain’s addiction to buying imports with a weak Pound.

But the rate of increase since the last period (8%) would – if the trend continued without any acceleration – give the UK a headline CPI inflation rate of just over 5% by June. Most forecasters would expect the rate to continue accelerating, in order to give Britain double-digit inflation by the Autumn.

As The Slog reported yesterday, MPC inflation hawk Andrew Sentance is due to give a major speech this Thursday. The MPC itself meets tomorrow.

Also on Thursday comes the latest unemployment data from the ONS, which is widely expected to show negative job growth again.

Most pressure will of course fall upon Mervyn King at the Bank of England, but while his attitude seems complacent, as I’ve been saying for months, I’ve yet to hear somebody tell me what he could do without causing further collateral damage. We have run out of options, and sooner rather than later now, both bankers and politicians need to face up to that reality.

Related: US stunned by MIT data showing 17.3% inflation going forward