Year-on-year growth of 2.2-percent exactly matched the Bank of England's forecast... reinforcing expectations that interest rates are set to remain unchanged for several more months to come.

With consumer price inflation below the 2% target level in both December and January and clearly below the levels forecast by the Bank of England in their November quarterly inflation report, a near-term interest rate cut suddenly looks a very real possibility again.

While it is clearly premature to sound the all-clear on inflation, the October consumer prices data are largely reassuring for the Bank of England and boost hopes that inflation has peaked,

With one member of the MPC voting for an interest rate cut in December and Bank of England chief economist, Charlie Bean, recently making some dovish comments, the odds of an interest rate cut early in 2006 are rising.

This underpins our belief that the Bank of England is too optimistic on the growth outlook and will eventually end up trimming interest rates by a further 25 basis points.

This is a really stunning retreat in retail sales. It reinforces our belief that the Bank of England is too optimistic about consumer spending.

This is still a pretty healthy report overall that suggests that the service sector has started 2006 relatively strongly. The report does little to change perceptions that the Bank of England will keep interest rates unchanged next week, and very probably for some time to come after then.

This is still a pretty benign report overall and broadly in line with Bank of England expectations contained in the February Inflation Report.

There is undeniably a growing risk that house prices could move markedly higher over the coming months. Indeed, this risk is clearly showing more prominently on the Bank of England's radar.