The UK’s inflation sped up to an annual rate of 3.0% in January from 2.5% in December, official figures showed on Wednesday.

Economists polled by Reuters had pointed to a reading of 2.8% in January, the same as the Bank of England’s forecast.

The central bank expects consumer price inflation to peak at 3.7% in the third quarter of this year – almost double its 2% target – driven mostly by higher energy costs and regulated tariffs for household utility bills and bus fares.

But Governor Andrew Bailey and his colleagues say a slowdown in the jobs market is likely to keep a lid on higher wage demands this year after an acceleration in late 2024, limiting the risk of a build-up of inflation pressure.