Fears over inflation rise

RISING inflation is more concerning than whether interest rates should be cut, the Bank of England's number two has warned.

- Martyn Brown

Deputy governor Clare Lombardelli said there should be a "gradual" reduction in rates to cool price hikes after inflation rose to 2.3% last month - its sharpest increase for two years.

Interest rates are currently 4.75% after two cuts in recent months.

The Bank upped rates in the past two years after inflation soared to a peak of 11.1%, but has now started to unwind this after it came below its 2% target.