A surprise rebound in headline inflation last month kept it perilously close to exceeding the 3 per cent level that would trigger an explanatory letter from the Bank of England to Gordon Brown, fuelling the threat of another increase in interest rates.

A steep jump in air fares in February meant that annual consumer price inflation unexpectedly climbed back to 2.8 per cent. The Bank’s bench-mark inflation measure had fallen sharply to 2.7 per cent in January, after jarring markets and the Bank’s Monetary Policy Committee (MPC) with a December surge to 3 per cent. Ironically, the disappointing inflation news for the Chancellor on the eve of the Budget was partly his fault thanks to the impact on air fares of the doubling of air passenger duty he ordered in December.

Analysts said that the disappointing figures would provide ammunition for MPC hawks pushing for an early rate rise.

The Bank’s concerns over persistent price pressures will be inflamed further after the more popular retail price index measure of inflation jumped last month to an annual rate of 4.6 per cent — up from 4.2 per cent in January to its highest since August 1991. This was partly because of three past rate rises feeding into mortgage costs.

MPC minutes today are expected to confirm that it split again over its decision to hold rates this month, with Tim Bes-ley and Andrew Sentance, its most hardline members, tipped to have again voted for a rise.

The hawks won fresh support for their case yesterday when it emerged that gross mortgage lending hit a record February level last month. While lending activity did ease from recent buoyant levels, it remained robust.

Economists said that MPC hardliners were likely to seize on evidence of more widespread upward pressure on prices. Last month this came from the cost of furniture and household equipment as well as dearer food. Only cheaper petrol and computer games prevented an even sharper rise in inflation.

Last night Kate Barker, an external MPC member, also sounded a warning over attempts by companies to push up their prices and bolster margins, telling business leaders that she would be monitoring these trends “particularly closely”. She acknowledged tentative signs of softening high street and housing market conditions that could hit growth, but emphasised: “It is not risks to growth but to the inflation outlook that are of most concern at present.” Although these risks were also uncertain, and Ms Barker said that pay pressures had “only picked up a little” despite higher inflation, her overall tone left open the prospect of her backing an early rate rise.

Lord George, the Bank’s former Governor, meanwhile told MPs that it must temper the strong consumer demand that it had stoked up at the turn of the decade as the only means to stave off recession. This had left a “legacy” of rapid house price inflation and record personal debt. However, Lord George rejected calls from some former MPC members for the Bank to attempt to stabilise prices of assets such as houses in a direct way.

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