Rising freight and clothing prices have driven UK inflation to rise in the month as businesses prepare for the end of a close and consumer spending is likely to spike.
Consumer prices rose at an annual rate of 0.7% in March, up from 0.4% the previous month, according to data from the Office of National Statistics released Wednesday. Analysts expect the figure to be 0.8%.
The increase in engine fuel prices means that transportation is the biggest driver of the rise, followed by clothing prices, which rebound towards the end of the regular sales period. Food prices partially offset these increases.
ONS separate figures showed on Tuesday that UK employers started hiring again in March, suggesting that businesses hope to grow in the economy when the constraints are on. further removed.
Economists are closely watching inflation as the UK eases its lockdown measures, which some concerns could lead to a period of high prices due to loosening monetary policy and freeing up demand accumulate when consumers spend the savings they’ve accumulated over the past year.
However, the increase is modest with inflation far below the Bank of England target of 2%.
After decreasing steadily over the past two years, inflation has plummeted during the coronavirus pandemic and hit a four-year low of 0.2 percent last summer.
Bank of England Governor Andrew Bailey was among economists who had estimated that inflation would begin to rise on target over the next few months, but said there was “no evidence” to suggest it would rise to levels. Can threaten price stability.
However, Andy Haldane, the Bank’s chief economist, warned last month against complacency, arguing there is a “tangible risk” that an inflationary tiger is stirred by monetary policy. super loose will be “harder to tame”.