Europe

UK inflation reaches a 2 1/2-year high in January

FILE - In this Thursday, Aug. 18, 2016 file photo, a Union Jack flag and a European flag blow in the wind in front of the city hall in London. A key British  business lobby is warning Britain’s government not to play favorites among industries when it negotiates the country’s exit from the European Union. (AP Photo/Frank Augstein, file)

FILE - In this Thursday, Aug. 18, 2016 file photo, a Union Jack flag and a European flag blow in the wind in front of the city hall in London. A key British business lobby is warning Britain’s government not to play favorites among industries when it negotiates the country’s exit from the European Union. (AP Photo/Frank Augstein, file)  (The Associated Press)

Inflation in Britain reached a 2 1/2-year high in January, as rising fuel prices pushed the rate closer to the central bank's target.

The Office for National Statistics said Tuesday that inflation hit 1.8 percent last month, just shy of the 2 percent target set by the Bank of England, and up from 1.6 percent in December.

The ONS said the costs of raw materials and goods leaving factories "both rose significantly" because of the pound's drop and higher oil prices.

The pound has lost almost a fifth of its value against the dollar since Britain voted in June to leave the European Union.

Ben Brettell, senior economist at Hargreaves Lansdown, says firms will soon have to pass on the burden of cost increases to consumers.