Tomorrow, British inflation figures for June will be published, just 24 hours before the Bank of England's monetary policy begins its two-day meeting to decide whether interest rates should be raised.

Swiss bank UBS expects the Government's preferred rate to fall to 2.4 per cent, below the target of 2.5 per cent, fuelling hope the bank may hold off from a third successive increase

But some in the City believe Chancellor of the Exchequer, Mr Gordon Brown, did not do enough in his budget to curb the consumer spending hoc and that the bank would have to do the job for him via higher interest rates.