UK inflation edges up as COVID price hit begins to ease
Inflation in the United Kingdom Increased in March due to the oil global pricing and the COVID pandemic which lead to the lift of clothing discounts but it’s expected to rise further as the economy reopens.
According to official figures released on Wednesday, consumer price inflation rose to 0.7 percent in March from 0.4 percent in February, only below the average estimate of 0.8 percent in a Reuters poll of economists.
British inflation is expected to rise in the next months due to:
- A spike in controlled household energy bills in April
- Higher global oil prices
- The contrasts with old prices before collapsing because of the corona virus.
In February, the bank of England predicted that inflation will hit 1.9 percent by the end of the year. Meanwhile, analysts believe it would surpass the 2 percent mark much sooner.
The Bank of England is expected to raise interest rates in the end of 2021 but some analysts disagree and expect it way earlier.
According to the ONS:
- In march manufacturers' prices increased by 1.9 percent
- The inputs paid and the prices increased almost 5.9% which is the highest since September 2018.