Inflation

Investors have come under increased pressure to inflation-proof their portfolios as a fresh spike in CPI and RPI raised doubts levels will drop back to the Bank of England's 2% target in 2012.

The Monetary Policy Committee(MPS) voted unanimously for an additional £75bn of quantitative easing at its latest meeting.

The governor of the Bank of England has said inflation is now at, or close to, its peak rate and will fall back "sharply" early next year.

CPI inflation surged to 5.2% in September, equalling a record set in 2008, the Office for National Statistics (ONS) said today.

Henderson's Charlie Awdry expects Chinese inflation to cool in Q4 and fall towards 5%, allowing the authorities flexibility to ease monetary policy and boost shares.

European inflation levels edged up 0.5% in September to 3%, Eurostat has confirmed, reducing the possibility of a rate cut.

China's tightened monetary policy appears to be having the desired effect on inflation as figures for last month showed CPI dipped to 6.1% in September.

The Bank of England has estimated its £200bn asset purchase program has raised inflation by as much as 1.5%.

Strategists have predicted inflation will fall back to target in the New Year when the VAT rise is stripped out of figures, freeing the Bank of England to pump in more money to stimulate the economy.

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