British consumer prices rose at the fastest annual pace in nearly 30 years last month, intensifying the squeeze on households and reinforcing the chances that the Bank of England will raise interest rates for a third meeting in a row.

The annual rate of consumer price inflation rose to 5.5% in January, the highest since March 1992, when Britain was emerging from a long period of inflation-feeding high wage deals. This was above most economists' forecasts in a Reuters poll for it to hold at December's 5.4% rate.

Earlier this month the Bank of England predicted inflation will peak at around 7.25% in April, when household energy bills are due to rise by more than half.

"This morning's upside surprise to UK inflation serves to underscore a recent global trend: higher and more persistent inflation has caught central banks on the back foot and opened the door to more interest rate hikes this year," said Ambrose Crofton, global strategist at J.P. Morgan Asset Management.

U.S. consumer price inflation hit a 40-year high of 7.5% in January, while inflation in the euro zone was a record 5.1%. 

The BoE has already raised rates twice since December - to 0.5% from 0.1% - and financial markets expect a further increase to 0.75% or 1% on March 17 after its next meeting.

Two-year British government bond yields hit their highest since 2011 shortly after the inflation data was released.