Bank of England interest rate-setter Megan Greene said on Friday she remained worried about signs of the pace of wage growth ahead and inflation expectations while a slowdown in the labour market appeared to be gradual.

The annual rate of consumer-price inflation was 3.4% in December, up from 3.2% in November, the first increase since July.

Growing divergence between US and UK monetary policy could increase inflation risks in Britain and complicate the path of interest rate cuts, a Bank of England (BoE) policymaker has warned. Megan Greene said looser-than-expected policy from the US Federal Reserve would add to UK inflationary pressures,

LONDON, Jan 21 (Reuters) - Britain's ‌main ​inflation measure sped ‌up by more than expected ​to 3.4% in December from 3.2% in November, ‍official figures showed ​on Wednesday. A Reuters poll of ​economists ⁠had shown a median forecast of a rise in consumer price inflation to 3.3%.

In December, headline inflation in the UK rose at an annual rate of 3.4 per cent, slightly above market forecasts of a 3.3 per cent increase and firmer than November’s 3.2 per cent rise.

Inflation in the United Kingdom’s economy continued to be above the Bank of England’s target in December at 3.4%.