Inflation increased in April, according to new figures from the Office for National Statistics (ONS).
The higher than expected uptick, measured by the Consumer Prices Index (CPI), saw inflation come in at 3.5% in April, up from 2.6% in March.
The largest upward contributions to the change came from housing and household services, transport, and recreation and culture, while the largest, partially offsetting, downward contribution came from clothing and footwear.
Core inflation, meanwhile, which takes out volatile factors like energy, food, alcohol and tobacco to give a clear picture of underlying trends, came in at 3.8% in the 12 months to April, up from 3.4% in March and above forecasts.
Martin Sartorius, principal economist, CBI, said: “April’s rise in inflation was widely expected, driven by a perfect storm of price pressures such as higher employer National Insurance contributions, the National Living Wage increase, and a hike in the Ofgem price cap.
“Looking ahead, the Bank of England expects that inflation will stay above 3% this year, as these pressures continue to impact households’ cost of living. This suggests that the Monetary Policy Committee is likely to hold rates in its next meeting, especially after May’s finely balanced decision to cut.
“Beyond then, the MPC will reduce borrowing costs at a gradual pace, as it assesses how price pressures are developing in the economy.”
