Martin Weale has called for an immediate 0.25% increase in the Bank of England (BoE) base interest rate, echoing the view of Monetary Policy Committee (MPC) hawk Andrew Sentance.
Inflation edged closer towards 4% in December as the rising cost of food and oil products continued to hit the price of goods and services.
M&G's Jim Leaviss says an interest rate rise in the UK could be "GDP suicide", although the Bank of England may still succumb to inflationary pressure.
The Bank of England has maintained interest rates at 0.5% and kept its quantitative easing programme at £200bn.
China has offered support to the eurozone to help it through the debt crisis that has gripped the region.
The Monetary Policy Committee's (MPC) Adam Posen has warned the Bank it should not try to compensate for its past mistakes in underestimating inflation by pushing up interest rates.
Britain's financial system is vulnerable to increased EU sovereign debt woes and bubbles in emerging market assets and junk bonds, the Bank of England (BoE) says.