Inflation climbs back up to 2.9%


House price inflation in England alone was 5.4% in July.

" Bank of England to begin tightening its monetary policy".

CPI picked up 0.6% month-on-month in August, the Office for National Statistics announced, after the 0.1% decline in July, even more than the 0.5% rise economists had predicted.

The larger than expected jump led to renewed speculation over whether the BoE will be forced to raise interest rates in the near future in order to keep inflation in check and prevent household finances from being eroded further and weakening consumer spending.

Britain's annual inflation rate accelerated in August, mainly on rising prices for motor fuels and clothing, official data showed on Tuesday, sending the pound to a year-high versus the dollar. This will inevitably raise questions about the UK's ongoing cost of living squeeze.

She said: "Worries about high inflation expectations becoming entrenched and the degree of spare capacity in the economy may well lead to more MPC members voting for a rate hike sooner rather than later".

In the meantime, inflation remains higher than earnings growth - which was 2.1% in the three-months to June.

Bestival 'murder' victim Louella Michie is daughter of Taggart star John Michie
Last year, organisers announced Bestival would be moved from the Isle of Wight, where it was previously held, to the Dorset site. The DJ and his wife Josie organise the festival, which took place for the first time on the Lulworth Estate in Dorset this year.

Some rain, wind in forecast for West Virginia courtesy of Irma
Weather officials warn that Irma is expected to keep producing high winds and heavy rain, although it has weakened . After making its way into Georgia, the storm is forecast to move into eastern Alabama on Tuesday morning.

Hurricane Irma Weakens to a Category 1 Storm
The Tampa Bay area feared a direct hit from a major hurricane, but ended up getting more of a sideways swipe from a weakened Irma. Irma remains off the west coast of Florida as it moves past Miami, but the city is being buffeted by high winds and heavy rain.

The core inflation rate increased to 2.7% from 2.4% previously and compared with consensus forecasts of 2.5% while the RPI inflation rate increased to 3.9% from 3.6% in July. Against this background, the recent volatility in the exchange rate represents a source of uncertainty which requires monitoring'.

"The thorny issue of inflation will be the driving force behind any rate rise decision on Thursday".

United Kingdom consumer price inflation including owner occupiers' housing costs (CPIH) came in at 2.7% in August, up from 2.6% in July.

- All eyes on Wednesday's United Kingdom wages and employment releases.

"Our view is that United Kingdom monetary policy will remain unchanged again this month, although the risk is the MPC sounds increasingly uncomfortable about a sleepy market attitude to interest rates", Deutsche Bank economists Mark Wall and Oliver Harvey said in a note on Tuesday.

The ONS confirmed the BOE's Monetary Policy Committee received a copy of the CPI index for its Friday September 8 meeting.

Meanwhile movement in the Euro is likely to be closely tied to the tone of this afternoon's speech by ECB Vice President Vítor Constâncio, with a more hawkish tone from the policymaker likely to strengthen the single currency.