The weakening pound is adding to the upward pressures on costs and prices from global markets, said Andrew Sentance, a member of the Bank of England's rate-setting committee, in a speech to the Confederation of British Industry.

"Sterling does matter for the control of UK inflation," he said. Prices of imports have risen sharply and this is feeding through into rising input costs for producers.

On the other hand, a significant slowdown in British consumer spending has increased in likelihood