The Bank of England has issued a 24-hour inflation warning - urging the Prime Minister Rishi Sunak and Chancellor Jeremy Hunt not to declare victory over inflation just yet. Andrew Bailey said the Bank's decision-makers are more concerned about the persistence of inflation than the financial markets appear to be.

He told MPs during a Treasury Committee session: "I really think the market is putting too much weight on the current data releases and the fact that we've seen inflation come down quite rapidly - that's good news obviously. We are concerned about the potential persistence of inflation as we go through the remainder of the journey down to 2%, and I think the market is underestimating that."

Consumer Prices Index (CPI) inflation fell to 4.6% in October from 6.7% in September, according to official figures. It prompted the Government to claim that it had met its inflation target early, having pledged to bring down the level to below 5.4% by the end of the year.

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Mr Bailey spoke out after declaring it is "much too early" to say inflation has been beaten, and to start talking about cutting interest rates. MP Dame Angela Eagle: "There have been claims in some places that the Prime Minister personally is responsible for halving inflation, do you agree with that?"

Mr Bailey said: "The Government and the Prime Minister adopted a target, it's not our target, I must be very clear on that. sked who is responsible for inflation coming down, he said: "It's very clear, the Bank of England is responsible for that." He told the committee: "For both corporate and household sectors, at the moment, we are seeing some signs of small pick-ups in arrears and some weakening in demand for credit, but from a low level.

"We are not seeing a collapse in either demand for credit or the ability of the financial system to supply credit." He said: "We do think services inflation will subside through next year. And it needs to subside through next year because services inflation above 6% is not consistent in getting headline inflation back to the 2% target."