ANNUAL Figures published by the
He said: "There's already great speculation about the exact timing of the first rate hike and this decision is becoming more balanced. It could happen sooner than markets currently expect."
And he warned: "The housing market is showing the potential to overheat."
"Our economy is headed in the right direction but for the moment it still requires the support that the Bank of
She meanwhile contrasted housing market conditions in
Ms Cameron said: "Although there is further evidence this month of rising house prices, it is again notable that there is a remarkable disparity between
"It is essential that, where this is addressed by the Bank of
He said: "Low inflation will not stop interest rates from rising, perhaps quite soon. But it should limit the size and speed of any increase and help the economic recovery to continue largely unconstrained...
"Unlike in so many previous cycles, the policy-makers should not be forced to slam the brakes on the recovery in order to prevent inflation from soaring or to dampen the housing market."
The fall in annual inflation in May was driven by air fares, and by food and clothing prices.
The ONS cited air transport as the largest contributor to the drop, with average fares falling 3.2 per cent between April and May, having risen 22 per cent between the same two months of 2013.
It said the timing of Easter was likely to be a factor in the differing movements, with the Easter weekend falling within the April data collection period this year but not last year.
Prices of food and non-alcoholic beverages fell between April and May, having been little changed between the same two months of 2013. The ONS cited a downward effect from a variety of product categories, most notably bread and cereals, meat, vegetables and soft drinks.
Clothing and footwear prices, overall, fell 0.1 per cent between April and May but rose by 1.2 per cent between the same two months of 2013.
Figures published by the