LONDON (Reuters) - British consumer price inflation rose last month at its fastest annual pace since May, though the monetary policy implications are limited as the rise is largely due to sharp falls in oil prices a year ago.

Consumer prices increased by 1.9 percent in November, up from 1.5 percent in October and a five-year low of 1.1 percent in September, official figures showed on yesterday — broadly in line with analysts' expectations of a 1.8 percent rise.

The ONS said transport costs — which are dominated by fuel — added nearly 0.5 percentage points to the annual rate of inflation.

The increase is mostly because an 8.3 percent drop in transport costs between October and November 2008 has now fallen out of the annual inflation data, replaced instead by a 2.3 percent rise between October and November this year.

Markets had largely expected the rise in inflation, with little price reaction after the data, and the Bank of England has also said it expects a temporary spurt in inflation over the coming months, aided by the end of a 13-month reduction in value-added tax on Jan. 1. "November's consumer price figures will do little to ease recent concerns over the near-term inflation outlook, but we remain convinced that price pressures will remain subdued over the medium term," said Jonathan Loynes, economist at Capital Economics.

The BoE has said inflation could rise above three percent early next year, but it does not expect this rate to become entrenched because elevated unemployment and spare capacity are likely to persist while the economy recovers from recession. The central bank aims for inflation of two percent over the medium term. As a result, economists said they did not expect the data to affect the BoE's £200 billion quantitative easing policy, which will have completed its planned purchases by February.