The Bank of England will upgrade its growth forecasts for the second time in three months this week as the economy continues to defy expectations of a post-Brexit vote slowdown.

Liz Martins, an economist at HSBC, expects the Bank’s 2017 growth forecast to rise to 1.7pc, from 1.4pc in November and just 0.8pc in August.

“Compared to the Bank’s initial post-referendum [forecast], this is a decidedly more upbeat picture,” she said.

The Monetary Policy Committee is expected to leave its growth forecast for 2018 at 1.5pc, with 1.6pc for 2019. Economists expect inflation to rise well above 2pc this year as the fall in the pound’s value pushes up import prices and consumer costs.

Inflation, as measured by the consumer prices index, jumped to 1.6pc in December.

However, Rob Wood, an economist at Bank of America Merrill Lynch, said the factors pushing up inflation over the past quarter, including stronger near-term growth and an 8pc oil price rise, would be more than offset by a 3pc rise in the value of the pound against a basket of currencies since November, as well as subdued expectations of further oil price rises.

He expects the Bank’s inflation forecast to fall to 2.5pc in 2018, from 2.7pc in November. Inflation this year is expected to hit 2.8pc.