United Kingdom inflation rate leaps to 2.3%
- Author: Leroy Wright Mar 21, 2017,
Mar 21, 2017, 11:54
It's also the first time that inflation has risen past the Bank of England's 2% target rate in more than three years.
ONS also reported the new measure of CPIH, which includes housing, also rose to 2.3% from 1.9%, beating the forecast for 2.2%. Food prices rose 0.3pc last month having fallen consistently for the past two and a half years. From this month, the ONS is including extended commentary on CPIH in its CPI releases, as it believes the reading is a more accurate gauge of price changes.
Rising transport costs caused by increases in the price of fuel were one of the main drivers of the headline increase in prices, the ONS said.
Jonathan Athow, ONS deputy national statistician, said: "Inflation has risen to its highest rate for nearly three and a half years with price increases seen across a range of items but with food and fuel having the largest impact". "Pay growth has remained subdued, while measures of inflation expectations remain at levels broadly consistent with the achievement of the inflation target".
And a rate rise is what the Pound needs for support.
Food is becoming more expensive as producers begin to pass down soaring import costs triggered by the pound's slump since the European Union referendum result.
The BoE expects inflation to peak at around 2.75% in early 2018 before "rifting gradually back down towards the target thereafter".