Commenting on the publication today of the CPI figures for October David Kern, economic adviser to the British Chambers of Commerce, said:

“Today’s figures show annual CPI inflation at 2.1 per cent in October after 1.8 per cent in September, slightly worse than expected.  After three months of below target CPI inflation the October figure is again slightly above target.

“The new CPI figures coming after yesterday’s producer prices figures highlight the sharp increases in fuel and food costs and heighten the worsening pressures on business margins.  The squeeze on businesses is intensifying, while the new figures will make the MPC more reluctant to consider a cut in interest rates.  “Unless wage pressures also increase, we believe there is still a case for a small cut in interest rate to offset the negative effect of the global credit crisis but the situation is difficult and businesses have to brace themselves for more difficult times.”