Interest rates are now expected to peak at 5.5pc by the end of the year after official data showed <a href="https://www.telegraph.co.uk/business/2023/05/24/ftse-100-markets-live-news-cpi-inflation/#1684908374082">inflation is proving more stubborn than expected</a>.

Traders have ramped up bets on continued aggressive rate rises from the Bank of England after official data showed price rises are taking longer than expected to cool.

Market bets on rate rises leapt after official figures showed that prices, as measured by the consumer prices index (CPI), rose by 8.7pc in the year to April.

While that was down from 10.1pc in March, it was a smaller drop than forecasters had expected.

Anticipation of more aggressive rises grows as incremental increases fail to tame inflation{ai:summary}<p>Interest rates expected to peak at 5.5pc by year end after inflation data proved stubborn. Traders increase bets on aggressive rate rises from Bank of England. #economy</p>

Interest rates to hit 5.5pc as food prices keep soaring

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