A further jump in the cost of living will be revealed today as inflation is expected to creep to nearly 3%.

The Consumer Prices Index for December, out today, was known to the Bank of England before it made its shock decision on Thursday to raise interest rates to 5.25%.

If inflation exceeds 3% - 1% or more above the 2% target rate - Bank of England Governor Mervyn King would be forced to write an explanatory letter to the Government for the first time since being granted independence in 1997.

Inflation reached a 10-year high of 2.7% in November, the seventh consecutive month it was above the 2% target.

And early predictions suggested it could nudge up to at least 2.8% in December.

But the Monetary Policy Committee's surprise quarter point base rate rise last week was seen as a sign inflation had surged even more than expected.

Malcolm Barr, of JP Morgan Chase Bank, is expecting the figure to come in at 3%, as is ING economist James Knightley.

Investec economist Philip Shaw was predicting a more modest rise to 2.8% before the base rate increase and has since admitted there is an "upward risk" on this figure, possibly to as high as 3.1%.

He said: "It is fairly easy to see it going up to 2.9% or 3%, but 3.1% is also possible, although you'd need a huge surge in food prices in particular to get that sort of jump."

If the rate does exceed the 3% mark, Mr King would publish an open letter to Chancellor Gordon Brown today.

The letter would need to detail why inflation had moved away from the target and what policy action was being taken to move it back in line with the 2% goal.

Mr King would also need to state how long it would take to return inflation to target and explain how the Bank was meeting the Government's monetary policy objectives.