The rate of inflation rose to 3.1 per cent in November as the squeeze on households continues.
With average weekly wages growing at just 2.2 per cent Brits are starting to feel the pinch in the run up to Christmas.
Inflation rose at the highest rate in nearly six years last month, according to ONS figures, with airfares and computer games contributing to the increase.
Mark Carney, the governor of the Bank of England, will now have to write a letter to Chancellor Philip Hammond explaining how the Bank intends to bring inflation back to its 2 per cent target.
In November, the Bank of England raised the interest rate for the first time in more than a decade from 0.25 per cent to 0.5 per cent.
However, it is not expected to announce a further increase when it publishes the results of the Monetary Policy Committee’s two-day meeting on Thursday.
Alistair Wilson, Head of Retail Platform Strategy at Zurich, comments: “Higher inflation is putting further strain on family finances as we approach what is already the most expensive time of the year, and it looks set to remain above the rate of wage growth as we move into 2018.
“While there are positive signs that a pay rise may be around the corner for Britain’s workers, with the recent Budget promising an above-inflation pay rise in the New Year for those on the minimum wage, it can be all too easy for this to fall away on daily spending rather than make a difference in the long-run.”
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