Inflation is set to crash through 4% this week - twice the government’s target rate - and economists are warning that soaring food and energy costs are poised to push the cost of living even higher next month.

Official data from the consumer price index (CPI) are expected to reveal inflation climbed from 3.8% in June to about 4.1% in July. The rate is forecast to go beyond 5% by September because of higher gas and electricity bills.

The Bank of England’s monetary policy committee is tasked with keeping inflation at 2%. With the rate now double this level, it is unable to cut interest rates to stimulate the economy.

If economists are right and the inflation rate continues to climb, Mervyn King, the governor of the Bank of England, will be forced to write a letter to chancellor Alistair Darling explaining the reasons for the missed targets.

King will give his latest forecasts for the economy in the Bank’s quarterly inflation report this week. The report will be published on Wednesday shortly after unemployment figures that are expected to show another rise in the claimant count.

Hector Sants, chief executive of the Financial Services Authority, meanwhile, has warned Britain’s banks to prepare for a recession on the scale of the early 1990s.

Philip Shaw, economist at Investec, said: “We can all see the factors that are pushing inflation higher. The one thing that’s going to hold back inflation is weakness in the economy, which is preventing price inflation from creeping through into wage growth.”

The gloomy prognosis comes as Richard Lambert, director-general of the CBI, warns ministers not to play fast and loose with the economy. In a letter sent to members of Britain’s largest business lobby group, Lambert said the “first and most important” principle for policymak-ers in the current environment was to “do no harm”.

“Don’t mess with monetary policy,” Lambert said. “This would be the worst possible time to move the goalposts, for example by shifting the [inflation] target in some way.”

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