Households have been warned to expect to feel the pinch of price rises on the shelves after inflation hit a two-and-a-half year high.

Hikes in the cost of air fares and food fuelled the sharper than expected increase.

Experts also predict that inflation will continue to inch upwards over the next 12 months, leading to a squeeze on many workers' pay packets.

Under one measurement, the Consumer Price Index (CPI), inflation hit 1.6 per cent in December, up from just 0.6 per cent in July immediately after the vote to leave the European Union.

Since then a fall in the pound has meant that imports are more expensive to bring into the UK, triggering price rises.

Experts warned that inflation is likely to increase further, in part because of higher fuel costs, and could even hit 3 per cent by the end of this year,

Conor D’Arcy, from the Resolution Foundation think tank, said that the days of ultra-low price increases seen in recent years were “well and truly over”.

While inflation was still low historically, he warned that there had been no similar rise in wage growth.

“It will be years until we see the overall economic impact of Brexit, but the one dead cert in 2017 is rising inflation – fuelled by a sharp fall in the pound,” he warned.

“With nominal pay only expected to rise by 2.4 per cent in 2017, the risk is we see a fresh pay squeeze with rising prices eating up all pay growth by the end of the year.”

Manufacturers are also starting to pass on costs following the collapse of the pound, experts warned.

And while a slight recovery in the oil price might be good news for the beleaguered North Sea it is bad news for consumers.

Helen Barnard, head of analysis at the Joseph Rowntree Foundation, said that a big driver of rising inflation was the cost of the weekly shop.

She warned the as prices rose the ongoing freeze on working-age benefits would put many households under increasing pressure.

The Liberal Democrats said that the figures showed that Brexit was "beginning to bite".

Lib Dem peer Baroness Kramer said that the falling pound was leading to higher prices in the shops.

"Theresa May says she wants a Red, White and Blue Brexit, but there is nothing patriotic about sinking the pound," she added.

"People did not vote to leave the Single Market, increase prices and cause our currency to collapse.

“Liberal Democrats will hold this Conservative Brexit Government to account and fight for Britain’s place in the Single Market."

The Centre for Economics and Business Research (Cebr) think tank warned that rising fuel and food prices were “highly toxic for consumers” and would “make life tougher” this year.

Martin Beck, senior economic advisor to the EY ITEM Club, said that the UK appeared to be heading for an inflation rate of close to 3 per cent towards the end of 2017.

But some Eurosceptics argued that inflation had been too low for too long.

Lord Lawson, the former chancellor, told peers that long before the Brexit vote "the majority of economists, including the Bank of England, were saying that sterling was overvalued and needed to come down and inflation was too low... and needed to go up.

"When these things are gradually happening they then say it is a disaster."