U.K. Inflation Surges Amid Warnings That Business Have Become Complacent

U.K. inflation rose more than forecast last month, the country's statistics office said Tuesday, just two days ahead of the Bank of England's next policy meeting that comes amid warnings that businesses and consumers have become too complacent over record-low interest rates.

Consumer prices accelerated at a 2.9% clip in August, the Office for National Statistics said, topping the 2.8% consensus forecast and matching May's four-year high. So-called core inflation, which strips out volatile prices for food and energy, rose to 2.7%, the ONS said, the highest since 2011.

"All else being equal, the depreciation of sterling seen in 2016 and particularly following the outcome of the EU referendum would increase the prices producers pay for imported goods," the ONS said. "Whilst depreciation is likely to increase the cost of imports, other factors determine whether these are passed on to consumers."

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