Inflation is set to hold steady for the third month in a row, as the rampant rise in the cost of living shows signs of peaking.
The Consumer Prices Index (CPI) measure of inflation will remain at 3% in November, according to City consensus figures, suggesting the mounting pressure on household finances is starting to ease.
CPI has paused at 3% throughout October and September, picking up from 2.9% in August and steadily rising from 1.8% at the start of the year.
The outcome has left Bank of England Governor Mark Carney teetering on the brink of having to write a letter to Chancellor Philip Hammond explaining why inflation is so high.
The Government has set an inflation target of 2%, with protocol dictating that the Bank must contact Mr Hammond if inflation exceeds 3% or falls short of 1%.
The Bank, which hiked interest rates to 0.5% earlier this month, has predicted CPI to peak at 3.2% in the autumn.
The CPI update on Tuesday will be followed by the Bank’s latest interest rates decision on Thursday, with the Monetary Policy Committee (MPC) widely expected to keep the cost of borrowing on hold.
Alan Clarke, Scotiabank’s head of European fixed income strategy, said inflation could still deliver an “upward surprise” for November.
However, he added: “We are probably at (or very close to) the peak in inflation for this cycle and inflation should soon begin to slow from these elevated levels.”
Consumers have been enduring a sustained pinch on their spending power since sterling’s Brexit-induced slump, with inflation racing ahead of Britain’s paltry earnings growth.
Upward pressure on inflation in October was partly boosted by rising food costs, as annual prices hit their highest level in four years at 4.2%.
On the month, food prices also grew by 0.6% in October, up from a 0.2% fall over the same period last year.
However, Investec analyst Ryan Djajasaputra expects food prices to drag on inflation in November, with some upward pressure coming from transport prices.
It comes after the UK economy made a lacklustre start to the fourth quarter, as the manufacturing sector expanded but the construction industry continued to slump in October.
Data from the ONS showed construction output unexpectedly fell by 1.7% on the month, while Britain’s buoyant manufacturing industry expanded by 0.1%.
The UK economy accelerated to 0.4% in the third quarter, with the majority of the expansion coming from the services and manufacturing industries.