Consumer prices in the U.K. increased by 10.1% in March.
The inflation rate decreased from the 10.4% recorded in February but was above the 9.8% expected by a Reuters poll of economists.
- Food,
housing, and household services such as gas and electricity, were the
main inflation drivers last month, the Office of National Statistics said.
- Prices of food and non-alcoholic beverages jumped 19.2% year-over-year, the sharpest increase in over 45 years.
- The
core inflation rate (which includes housing costs but excludes prices
of alcohol, tobacco, food, and energy) increased by 5.7% year over year.
- Hugh
Gimber, global market strategist at JPMorgan Asset Management, said "an
extended period of depressed economic growth" will be necessary to
bring core price pressures down.
- He expects the Bank of England to raise interest rates by an additional 25 basis points in May.
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- Consumer price increases are likely to fuel demands from unions as the U.K. remains gripped by widespread strikes in the public sector.
- Despite the ONS's latest data, the U.K. remains on track to halve inflation by the end of 2023, according to U.K. Finance Minister Jeremy Hunt.
