UK inflation set to be pushed up by budget
A broad trade war could add to price pressures
Investors scale back bets on BoE rate cuts
New UK government trying to boost growth

LONDON, Nov 15 Reuters Just when Britain seemed to be moving beyond its inflation problem, the new government39;s spending splurge and the risk of a global trade war triggered by U.S. Presidentelect Donald Trump39;s tariff plan are threatening to extend it.

British inflation peaked above 11 two years ago after the outbreak of the Ukraine war, the highest among the world39;s big rich economies. It then took longer to fall than in many other countries, in part because of a shortage of workers following Britain39;s exit from the European Union.

No one expects another doubledigit price leap. But the Bank of England raised its inflation forecasts for the next three years after the Oct. 30 budget, which increased taxes on employers, threatening to push up prices and wages .

Trump39;s election win then prompted investors to cut further their bets on BoE interest rate reductions next year.

That could pose an additional challenge to Prime Minister Keir Starmer39;s promise to voters in July39;s election that he will turn Britain into the fastestgrowing Group of Seven economy.

We think the UK budget and Mr. Trump39;s election will boost UK inflation and rates, consultancy Pantheon Macroeconomics told clients in a note on Thursday.

The hefty public spending increases in the budget and their expected…