The heat from UK inflation continued to be felt after the latest data readings published showed consumer prices continued to soar higher in March.
According to a report by the Office for National Statistics (ONS), the UK’s annual consumer price index (CPI) rose to 7.0% from 6.2% recorded in February. This is the highest figure ever recorded since March 1992, at 7.1%.
The figures also far exceeded market expectations for an increase of only 6.7%, with the surge in energy prices continuing to be the biggest contributor to this increase.
Meanwhile, core inflation (excluding food and energy prices) increased to 5.7% year -on -year from 5.2% previously.
UK inflation has seen an extraordinary surge over the past six months in line with increases in most other advanced economies following soaring energy prices and ongoing global supply chain issues.
Starting April 1, British energy regulators increased the household energy price limit by 54% following the surge in energy prices and this is seen to push inflation further up in the coming months.
The decision now rests with the UK government and the Central Bank of England (BOE) on how they will act to control the situation from getting worse.
The pound depreciated lower following this publication as it was impacted by the strengthening US dollar and expectations that the BOE would ease the tightening even as inflation continued to rise.
