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| UK inflation falls as meat and crumpet prices drop | UK inflation falls as meat and crumpet prices drop |
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| Price falls for some food items like meat, crumpets and chocolate biscuits helped drive inflation down to its lowest level in two-and-a-half years. | Price falls for some food items like meat, crumpets and chocolate biscuits helped drive inflation down to its lowest level in two-and-a-half years. |
| The rate consumer prices have been rising at fell to 3.2% in the year to March, down from 3.4% the month before, according to official figures. | The rate consumer prices have been rising at fell to 3.2% in the year to March, down from 3.4% the month before, according to official figures. |
| Inflation has been falling gradually since it peaked at 11.1% in late 2022. | Inflation has been falling gradually since it peaked at 11.1% in late 2022. |
| However, lower inflation does not mean prices overall are coming down, they are just rising less quickly. | However, lower inflation does not mean prices overall are coming down, they are just rising less quickly. |
| According to the Office for National Statistics (ONS), the price rises seen across most types of food products eased between February and March, with small increases being seen for bread and cereals. | According to the Office for National Statistics (ONS), the price rises seen across most types of food products eased between February and March, with small increases being seen for bread and cereals. |
| Meat prices fell by 0.5% between February and March, compared with a rise of 1.4% a year ago, with pork products one of the big reasons behind the slowing rate. | |
| Prices for furniture and household goods like cleaning products also fell by 0.9% in the year to March. | |
| Soaring food and energy bills have been the main causes behind the UK's high inflation in recent years. | Soaring food and energy bills have been the main causes behind the UK's high inflation in recent years. |
| Oil and gas were in greater demand after the pandemic, and prices surged again when Russia invaded Ukraine, cutting global supplies. The conflict also reduced the amount of grain for sale, pushing up food prices. | |
| It led to inflation for food and non-alcoholic drinks hitting a peak of 19.2% in March last year - the highest level seen since the 1970s. | It led to inflation for food and non-alcoholic drinks hitting a peak of 19.2% in March last year - the highest level seen since the 1970s. |
| While the overall rate of inflation has come down, goods in the shops are still much more expensive than they were a few years ago and shoppers will not see costs reverting to the levels they were used to. | |
| Grant Fitzner, chief economist for the ONS, said lower costs were off-set by rising fuel prices last month. | |
| The average price of petrol rose by 2.6p per litre between February and March to stand at £1.45. Diesel prices also rose by 2.8p per litre to £1.54. | |
| While the overall rate of inflation in March was slightly higher than economists expected, Chancellor Jeremy Hunt described the figures as "welcome news". | While the overall rate of inflation in March was slightly higher than economists expected, Chancellor Jeremy Hunt described the figures as "welcome news". |
| He said that due to lower inflation and the government's recent cut in National Insurance for the employed and self-employed, which came into force on 6 April, "people should start to feel the difference as well as see it in their pay cheques". | He said that due to lower inflation and the government's recent cut in National Insurance for the employed and self-employed, which came into force on 6 April, "people should start to feel the difference as well as see it in their pay cheques". |
| However, Rachel Reeves, Labour's shadow chancellor said working people would still feel worse off. | However, Rachel Reeves, Labour's shadow chancellor said working people would still feel worse off. |
| "Prices are still high in the shops, monthly mortgage bills are going up and inflation is still higher than the Bank of England's target," she said. | "Prices are still high in the shops, monthly mortgage bills are going up and inflation is still higher than the Bank of England's target," she said. |
| Liberal Democrat Treasury spokesperson Sarah Olney said: "Nobody will notice this in their pockets. By patting themselves on the back for this record, Rishi Sunak and Jeremy Hunt have proved just how out of touch they are." | |
| The latest inflation data comes ahead of the Bank of England's next decision on interest rates on 9 May. The UK's central bank has been increasing interest rates in a bid to slow price rises and bring inflation back to its 2% target. | The latest inflation data comes ahead of the Bank of England's next decision on interest rates on 9 May. The UK's central bank has been increasing interest rates in a bid to slow price rises and bring inflation back to its 2% target. |
| The theory is that if you make borrowing more expensive, people have less money to spend, or may choose to save more as saving rates go up. This in turn reduces demand for goods and helps cool inflation. | The theory is that if you make borrowing more expensive, people have less money to spend, or may choose to save more as saving rates go up. This in turn reduces demand for goods and helps cool inflation. |
| But there are many factors the Bank's Monetary Policy Committee will take into account. | But there are many factors the Bank's Monetary Policy Committee will take into account. |
| Core inflation, for example, which strips out the effect of more volatile energy and food prices, also eased to 4.2% in March. | Core inflation, for example, which strips out the effect of more volatile energy and food prices, also eased to 4.2% in March. |
| It was still slightly higher than economists expected, and the Bank will also keep a keen eye on things like employment figures, wages and services inflation, which looks at price rises seen across hospitality to hairdressing, and stood at 6%, down from 6.1% in February. | It was still slightly higher than economists expected, and the Bank will also keep a keen eye on things like employment figures, wages and services inflation, which looks at price rises seen across hospitality to hairdressing, and stood at 6%, down from 6.1% in February. |
| How fast are prices rising in the UK? | How fast are prices rising in the UK? |
| How much are prices rising for you? Try our calculator | |
| On Tuesday, governor Andrew Bailey said the question for rate-setters at the Bank was how much more evidence was necessary before starting to cut interest rates in the coming months. | On Tuesday, governor Andrew Bailey said the question for rate-setters at the Bank was how much more evidence was necessary before starting to cut interest rates in the coming months. |
| He made the remarks at the International Monetary Fund's latest meetings in Washington DC. | |
| Consumer prices in the US rose faster than expected last month, with the UK inflation rate now sitting below that of the United States for the first time since early 2022. | |
| Ian Stewart, chief economist at Deloitte, said that although inflation may be in "retreat" in the UK,"the Bank of England cannot yet be sure that it is beaten". | |
| With people's wage growth remaining above forecasts, "and the economy reviving, the Bank will be in no hurry to cut interest rates", he said. | With people's wage growth remaining above forecasts, "and the economy reviving, the Bank will be in no hurry to cut interest rates", he said. |
| Yael Selfin, chief economist at KPMG UK, said that Wednesday's figures were "unlikely" to move the needle for the Bank of England. | |
| David Hollingworth from broker London and Country suggested any homeowners due to renew their mortgage hoping for further cuts may find themselves in for a long wait, "with uncertainty still in the air". | |
| Ms Selfin also pointed out there were still several risks which may cause a setback for investors, businesses and consumers. | |
| "Oil prices have rallied over the past month which has led to an increase in prices at the pump for consumers. Also, the hike in the National Living Wage could potentially contribute to persistence in services inflation which remains elevated." | "Oil prices have rallied over the past month which has led to an increase in prices at the pump for consumers. Also, the hike in the National Living Wage could potentially contribute to persistence in services inflation which remains elevated." |
| And there is still a question mark over how resilient households in the UK are, having been faced with high costs and some being left with unaffordable debts. | And there is still a question mark over how resilient households in the UK are, having been faced with high costs and some being left with unaffordable debts. |
| On Wednesday, separate ONS figures showed that private rents had increased by 9.2% in the 12 months to March, now averaging £1,285 in England. | |
| Next month's overall inflation figure looking back at April is expected to show a bigger drop as the lower energy price cap is taken into account, even as households' direct debits remain higher. | Next month's overall inflation figure looking back at April is expected to show a bigger drop as the lower energy price cap is taken into account, even as households' direct debits remain higher. |
| How can I save money on my food shop? | How can I save money on my food shop? |
| Look at your cupboards so you know what you have already | Look at your cupboards so you know what you have already |
| Head to the reduced section first to see if it has anything you need | Head to the reduced section first to see if it has anything you need |
| Buy things close to their best before date which will be cheaper and use your freezer | Buy things close to their best before date which will be cheaper and use your freezer |
| Read more tips here | Read more tips here |
| Related Topics | Related Topics |
| Inflation | Inflation |
| Cost of Living | Cost of Living |
| UK economy | UK economy |
| Office for National Statistics | Office for National Statistics |