UK inflation jumps to 3%, reducing chance of early interest rate cut

Bank of England forecasters have predicted that inflation will rise to 3.7% later this year. Photograph: Matthew Horwood/Getty Images

UK inflation accelerated faster than expected at the start of this year, eating into workers’ wages and reducing the chance of an interest rate cut next month.

The consumer prices index (CPI) measure rose to 3% in January, the Office for National Statistics reported, up from 2.5% in December.