UK inflation rate to fall ahead of rise

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THE UK’S rate of inflation will drop back today in a brief respite before a predicted surge in the cost of living over the coming months.

The consensus forecast of City analysts is for the consumer price index (CPI) to have fallen to 2.6 per cent in November, from 2.7 per cent in October, when figures from the Office for National Statistics (ONS) are published.

The impact of energy bill increases from supplier SSE will be offset by the effect of steeper utility bill rises in November last year. But with further hikes from other providers coming into force, CPI inflation is predicted to peak at 3.5 per cent by mid-2013.

Last week E.ON was the last of the “big six” energy companies to announce it would increase prices, after the other five major energy firms had already imposed winter price hikes of between 6 per cent and 10.8 per cent.