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15 February 2011
Last updated at 04:59 ET
The UK Consumer Prices Index (CPI) annual inflation rate rose to 4% in January, up from 3.7% in December.
Retail Prices Index (RPI) inflation - which includes mortgage interest payments - rose to 5.1% from 4.8%.
The CPI figure is the highest since November 2008, and will put pressure on the Bank of England to lift interest rates to curb accelerating inflation.
Oil and food price rises mean inflation has been above the 2% target by one percentage point or more for 14 months.
The price of petrol as measured by the CPI was £1.27 a litre in January 2011, which the Office for National Statistics said was a record high.
Other contributing factors included rising costs of transport, restaurants and hotels, furniture and alcohol.
The monthly figures are the first to include the effects of the rise in VAT from 17.5% to 20%, which took place on 4 January.
"Two of the main factors that had an impact on the January data are the increase in the standard rate of Value Added Tax (VAT) to 20% and the continued increase in the price of crude oil," the ONS said in a statement.
Letter The CPI rate rose 0.1% on a monthly basis between December and January - the first time since records began in 1997 that inflation has risen between those two months.
Bank of England governor Mervyn King will now be forced to write another letter to the government, after sending three last year, explaining what action will be taken to tackle inflation.
Until now, the Bank has been confident that the pick-up in the inflation rate would be temporary, with no need for an interest rate increase in the near term.
However, it may now have to adopt a harder stance.
'Overshot target' It means that more data this week, including the Bank's inflation report on Wednesday, jobs figures the same day, and retail sales figures on Friday, will be closely watched.
"The [inflation] numbers are broadly in line with market expectations, but the issue for the MPC is that inflation has overshot its target for much of the last 5 years and many are doubting its commitment to the inflation target," said Amit Kara, at UBS.
"Under these circumstances the committee has no choice but to sound hawkish at tomorrow's inflation report.
"We're looking for a [third quarter] rate hike but if the economic growth surveys remain good, that could be brought forward."
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Retail Prices Index (RPI) inflation - which includes mortgage interest payments - rose to 5.1% from 4.8%.
The CPI figure is the highest since November 2008, and will put pressure on the Bank of England to lift interest rates to curb accelerating inflation.
Oil and food price rises mean inflation has been above the 2% target by one percentage point or more for 14 months.
The price of petrol as measured by the CPI was £1.27 a litre in January 2011, which the Office for National Statistics said was a record high.
Other contributing factors included rising costs of transport, restaurants and hotels, furniture and alcohol.
The monthly figures are the first to include the effects of the rise in VAT from 17.5% to 20%, which took place on 4 January.
"Two of the main factors that had an impact on the January data are the increase in the standard rate of Value Added Tax (VAT) to 20% and the continued increase in the price of crude oil," the ONS said in a statement.
Letter The CPI rate rose 0.1% on a monthly basis between December and January - the first time since records began in 1997 that inflation has risen between those two months.
Bank of England governor Mervyn King will now be forced to write another letter to the government, after sending three last year, explaining what action will be taken to tackle inflation.
Until now, the Bank has been confident that the pick-up in the inflation rate would be temporary, with no need for an interest rate increase in the near term.
However, it may now have to adopt a harder stance.
'Overshot target' It means that more data this week, including the Bank's inflation report on Wednesday, jobs figures the same day, and retail sales figures on Friday, will be closely watched.
"The [inflation] numbers are broadly in line with market expectations, but the issue for the MPC is that inflation has overshot its target for much of the last 5 years and many are doubting its commitment to the inflation target," said Amit Kara, at UBS.
"Under these circumstances the committee has no choice but to sound hawkish at tomorrow's inflation report.
"We're looking for a [third quarter] rate hike but if the economic growth surveys remain good, that could be brought forward."
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