The UK's inflation rate rose to 0.7 per cent in March from 0.4 per cent in February, pushed up by higher fuel and clothing, official data showed.
The acceleration in consumer prices came during the last month of the third lockdown in England and amid tighter restrictions across the rest of the country.
Jonathan Athow, statistician at the Office for National Statistics, said the rate of inflation increased with petrol prices rising and sales of clothes recovering from a decline in February.
"However, food prices fell back on the year, as prices of some staples were lower than at the start of the pandemic,” he said.
Inflation dipped unexpectedly in February, partly because of the biggest annual contraction in clothing and footwear prices since 2009.
However, the discounting in February eased in March, the ONS said, though it was still high for this time of year.
Meanwhile, prices charged by manufacturers rose by 1.9 per cent in the year to March, the highest in nearly two years, and the prices they paid for their inputs jumped by almost 5.9 per cent, the most since September 2018.
While inflation has held below the Bank of England’s 2 per cent target for 18 months, analysts expect it to surge this year as the economy recovers from its worst recession in 300 years.
BoE chief economist Andy Haldane raised concerns in February about upside risks for the measure as consumers start spending some of the £150 billion ($209bn) in excess savings they accumulated when shops and restaurants were closed during lockdown.
Adam Vettese, analyst at multi-asset investment platform eToro, said while the first signs of inflation are starting to emerge now that some restrictions are lifted and households can spend again, this should not be viewed as a threat but rather as a sign of increased economic activity.
“The fact transport and fuel costs were the biggest contributors to inflation in March suggests both individuals and firms are taking back to the road, which is a tell-tale sign of increased economic activity,” he said.
“In normal times, a 0.3 percentage point rise in inflation might be enough to cause unease among BoE officials and investors, but it’s likely both will stomach rising prices as a consequence of the economic recovery for now.”
While the BoE expects inflation to reach 1.9 per cent by the end of this year, Mr Haldane, who is set to step down in June, called inflation "a tiger" that may prove difficult to tame.
The rest of the nine-member Monetary Policy Committee were more relaxed about the prospect of rising inflation, saying they need to see a sustained increase in prices before tightening their stimulus programme.
Janine Boshoff, economist at the National Institute of Economic and Social Research, said the gradual easing of the winter lockdown could introduce some volatility over the short term, as items in the non-essential retail, restaurant and hotels categories are reintroduced to the calculation of consumer inflation.
Meanwhile, Paul Craig at Quilter Investors said the UK has reached a turning point in its economic reaction to the pandemic where price growth is now on an upward trajectory.
"From here, inflation may tick markedly higher if the steady drip of consumer spending morphs into a waterfall as lockdown restrictions are lifted and households spend some of their accumulated pandemic saving,” Mr Craig said.
Separately, UK house prices increased 8.6 per cent in February compared to the same month a year ago, the highest annual growth rate since October 2014.
It was also up from 8 per cent in January, with the average house price £250,000 in February, indicating no change since December 2020.
However, it was still £20,000 higher than the same period a year ago.
More on UK inflation
Britain’s inflation rate unexpectedly falls to 0.4% in February
UK's inflation shopping basket: hand sanitiser and loungewear in, white chocolate out
Bank of England's Andy Haldane says inflation 'tiger' is on the prowl
THE BIO
Age: 30
Favourite book: The Power of Habit
Favourite quote: "The world is full of good people, if you cannot find one, be one"
Favourite exercise: The snatch
Favourite colour: Blue
Three ways to get a gratitude glow
By committing to at least one of these daily, you can bring more gratitude into your life, says Ong.
- During your morning skincare routine, name five things you are thankful for about yourself.
- As you finish your skincare routine, look yourself in the eye and speak an affirmation, such as: “I am grateful for every part of me, including my ability to take care of my skin.”
- In the evening, take some deep breaths, notice how your skin feels, and listen for what your skin is grateful for.
David Haye record
Total fights: 32
Wins: 28
Wins by KO: 26
Losses: 4
The specs: 2018 Jeep Compass
Price, base: Dh100,000 (estimate)
Engine: 2.4L four-cylinder
Transmission: Nine-speed automatic
Power: 184bhp at 6,400rpm
Torque: 237Nm at 3,900rpm
Fuel economy, combined: 9.4L / 100km
Indoor cricket in a nutshell
Indoor cricket in a nutshell
Indoor Cricket World Cup - Sept 16-20, Insportz, Dubai
16 Indoor cricket matches are 16 overs per side
8 There are eight players per team
9 There have been nine Indoor Cricket World Cups for men. Australia have won every one.
5 Five runs are deducted from the score when a wickets falls
4 Batsmen bat in pairs, facing four overs per partnership
Scoring In indoor cricket, runs are scored by way of both physical and bonus runs. Physical runs are scored by both batsmen completing a run from one crease to the other. Bonus runs are scored when the ball hits a net in different zones, but only when at least one physical run is score.
Zones
A Front net, behind the striker and wicketkeeper: 0 runs
B Side nets, between the striker and halfway down the pitch: 1 run
C Side nets between halfway and the bowlers end: 2 runs
D Back net: 4 runs on the bounce, 6 runs on the full
THE SPECS
Engine: 3.9-litre twin-turbo V8
Transmission: seven-speed dual clutch
Power: 710bhp
Torque: 770Nm
Speed: 0-100km/h 2.9 seconds
Top Speed: 340km/h
Price: Dh1,000,885
On sale: now
The%20National%20selections
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Schedule for show courts
Centre Court - from 4pm UAE time
Johanna Konta (6) v Donna Vekic
Andy Murray (1) v Dustin Brown
Rafael Nadal (4) v Donald Young
Court 1 - from 4pm UAE time
Kei Nishikori (9) v Sergiy Stakhovsky
Qiang Wang v Venus Williams (10)
Beatriz Haddad Maia v Simona Halep (2)
Court 2 - from 2.30pm
Heather Watson v Anastasija Sevastova (18)
Jo-Wilfried Tsonga (12) v Simone Bolelli
Florian Mayer v Marin Cilic (7)
Real estate tokenisation project
Dubai launched the pilot phase of its real estate tokenisation project last month.
The initiative focuses on converting real estate assets into digital tokens recorded on blockchain technology and helps in streamlining the process of buying, selling and investing, the Dubai Land Department said.
Dubai’s real estate tokenisation market is projected to reach Dh60 billion ($16.33 billion) by 2033, representing 7 per cent of the emirate’s total property transactions, according to the DLD.
COMPANY%20PROFILE
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Labour dispute
The insured employee may still file an ILOE claim even if a labour dispute is ongoing post termination, but the insurer may suspend or reject payment, until the courts resolve the dispute, especially if the reason for termination is contested. The outcome of the labour court proceedings can directly affect eligibility.
- Abdullah Ishnaneh, Partner, BSA Law
UAE currency: the story behind the money in your pockets
Key findings
- Over a period of seven years, a team of scientists analysed dietary data from 50,000 North American adults.
- Eating one or two meals a day was associated with a relative decrease in BMI, compared with three meals. Snacks count as a meal. Likewise, participants who ate more than three meals a day experienced an increase in BMI: the more meals a day, the greater the increase.
- People who ate breakfast experienced a relative decrease in their BMI compared with “breakfast-skippers”.
- Those who turned the eating day on its head to make breakfast the biggest meal of the day, did even better.
- But scrapping dinner altogether gave the best results. The study found that the BMI of subjects who had a long overnight fast (of 18 hours or more) decreased when compared even with those who had a medium overnight fast, of between 12 and 17 hours.
