IVA : Inflation rises to 3%

The rate of inflation has risen to an 11 year high of 3% per annum. The governments preferred indicator, The Consumer Prices Index, rose 0.6% in December pushing it well past Chancellor Gordon Browns 2% target.

These latest figures will hit thousands of consumers as the cost of living soars, pushing already tight household budgets nearer breaking point.

Rising petrol prices and fuel duty increases announced in the chancellors Pre-Budget Report have put the biggest pressure on prices. Furniture prices have also contributed, last month rising at their fastest monthly rate, as retailers increased their prices ahead of the January sales.

The Bank of England raised the interest rate last week to 5.25% in an effort to bring inflation under control.

The Retail Prices Index rose to 4.4%, its highest in 15 years and inflation has been above the Bank of England's target since May 2006.

Further increases in interest rates can't be ruled out as the Bank attempts to keep a tight reign over The Retail Prices Index, the bench mark for wage increase settlements. Policymakers are worried that the increasing cost of living will fuel inflationary demands in the crucial New Year pay bargaining round, triggering a wage-price spiral.

All these indicators add to concern that the volume of serious debt will rise in 2007, increasing the number of people requiring an Individual Voluntary Arrangement to help them with their problem

If you need help with a serious debt problem, then an Individual Voluntary Arrangement may be the solution for you.

If you would like to talk through your personal debt circumstances with a professional Individual Voluntary Arrangement adviser, then call the debt specialistsat www.myIVA-Adviser.com for free on 0800 088 7503, now.

• News and Press