UK inflation jumps to 3% in April
UK consumer inflation reached its highest level in 13 months driven by high food and fuel costs, according to the Office for National Statistics.
The Consumer Prices Index (CPI) hit 3% on an yearly basis in April, up from 2.5% in March, it said.
The monthly inflation rate was 0.8%, the biggest leap since May 2001. The Retail Prices Index hit 4.2% from 3.8%.
The inflation data would probably stop the Bank of England cutting interest rates in the near term, analysts said.
However, they added that the main drivers of price growth were fuel and food costs, which higher interest rates did little to control or rein in.
In the current climate of slowing economic growth and a weakening housing market it was unlikely that the Bank would hike interest rates as price pressures were not being caused by an overheating economy, the analysts said.
The CPI figure is above the 2% government target, and increases the chances that Mervyn King, the Bank’s governor, will be forced to write to the Chancellor to explain the rise in inflation.
He has to write a letter to the Chancellor if the rate of inflation tops 3%.
Source: BBC News