UK households under pressure as inflation sticks at 3%

Expectations dashed that rate would fall as effects of Brexit vote on pound fade

British households remained under significant pressure last month from rising prices as the rate of inflation stayed at its highest level for almost six years, continuing the squeeze on consumers.

The consumer price index (CPI) held steady at 3% in January for the second month running, according to the Office for National Statistics, confounding economists' expectations that the rate would fall to 2.9% as the effects of the post-EU referendum drop in the pound begin to fade.

Inflation is when prices rise. Deflation is the opposite - price decreases over time - but inflation is far more common.