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Inflation is currently running at more than the target rate of three per cent and is likely to continue rising over the forthcoming months, according to the Press Association.
GDP growth in the UK has been revised down from 0.4 per cent to 0.3 per cent, while manufacturing activity has fallen to its lowest level since the 9/11 terrorist attacks in the US.
Mervyn King, the governor of the Bank of England, recently proclaimed his determination to clamp down on rising prices, though he also warned of the need to avoid an economic slowdown that would pull inflation below its target of two per cent.
Mr King recently told the Commons Treasury select committee: "We are now seeing the great unwinding, or deleveraging as it is known in the US, of banks' balance sheets."
