Inflation climbs to 4.5%

Inflation climbed marginally in August as expected, driven up by higher utility bills.

The Consumer Prices Index (CPI) measure of inflation rose to 4.5% last month, the Office of National Statistics (ONS) said, up from 4.4% the previous month. Meanwhile RPI - which includes house prices - rose to 5.2% from 5% the month before. The Bank of England's target rate for CPI is 2%, and it expects inflation to return to target in the next two years. The move higher is expected to be repeated in the coming months as energy price rises continue to feed through. With no shock jump, sterling strengthened marginally immediately after the release, while the yield on ten-year gi...