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UK inflation jumps to 3% in April | UK inflation jumps to 3% in April |
(10 minutes later) | |
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%. |