Inflation eases but still remains above 10% as food costs at 45-year high
The rate of inflation has eased slightly but still remains above 10%, according to official figures showing food and drink costs at a 45-year high.
The Office for National Statistics (ONS) said the consumer prices index (CPI) measure slowed to 10.1% in March from 10.4% the previous month.
Economists had largely expected a figure of 9.8%.
The data represents a slight improvement in the energy-driven cost of living crisis as fuel prices fell back to levels seen a year ago when Russia’s war in Ukraine prompted a spike in oil costs.
However, upwards pressure remained from household gas and electricity and food, including essentials such as bread, milk and eggs.
Food and non-alcoholic drink inflation was measured at 19.1% by the ONS – the highest level since August 1977.
High commodity and production costs are mostly to blame.
Other factors behind the spike were highlighted in February’s inflation data when the salad shortage struck supermarkets.
A crumb of comfort is that prices for goods such as tomatoes and cucumbers are tipped to fall sharply as the UK growing season gathers pace.
ONS chief economist Grant Fitzner said of the easing in overall inflation in March: “The main drivers of the decline were motor fuel prices and heating oil costs, both of which fell after sharp rises at the same time last year.
“Clothing, furniture and household goods prices increased, but more slowly than a year ago.
“However, these were partially offset by the cost of food, which is still climbing steeply, with bread and cereal price inflation at a record high.
“The overall costs facing business have been largely stable since last summer, although prices remain high.”
The latest figures were released against a backdrop of hopes that a deceleration in inflation would allow the Bank of England to pause its action to battle inflation through interest rate rises.
It has raised Bank rates at 11 consecutive meetings since December 2021 in a bid to keep a lid on price pressures in the economy.
While policymakers can do nothing about things like energy – the main driver of the inflation crisis – the Bank can look to take demand out of the economy by raising borrowing costs.
It will have been encouraged by the easing in the headline rate of inflation.
But a separate measure closely watched by the Bank that strips out volatile price elements, known as core inflation, remained static at 6.2%.
Employment data released on Tuesday also showed that wages continued to creep upwards, albeit at levels well below CPI.
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What is driving wages up?
The Bank has previously expressed worries that wage rises seeking to combat the hit to household budgets from inflation, which have come into sharp focus during the winter strikes across the economy, risk stoking inflation ahead.
Financial market data suggested the chance of a 0.25 percentage point rise in Bank Rate at the next meeting, due next month, had risen from 80% to 95%.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, commented: “‘The heat has been turned down on the bubbling cauldron of prices, but inflation is still scalding and interest rates look set to be pushed up again to try and cool it down rapidly.
“Instead of retreating below double digits, CPI is staying stubbornly high, causing more pain for companies and consumers.”
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Chancellor Jeremy Hunt said: “These figures reaffirm exactly why we must continue with our efforts to drive down inflation so we can ease pressure on families and businesses.
“We are on track to do this – with the OBR (Office for Budget Responsibility) forecasting we will halve inflation this year – and we’ll continue supporting people with cost-of-living support worth an average of £3,300 per household over this year and last, funded through windfall taxes on energy profits.”
Labour shadow chancellor, Rachel Reeves, said: “The question for families remains as real as ever – when will they feel better off under this Conservative government?
“And, why when the cost of living continues to bite, is the government refusing to freeze council tax this year, paid for by a proper windfall tax on oil and gas giants?”
UK
Masked burglars ‘raid’ Windsor Castle grounds ‘while William, Kate and children slept at home on estate’
Masked burglars have stolen farm vehicles from the Windsor Castle estate while members of the Royal Family are believed to have been asleep nearby.
Two men scaled a 6ft fence on the night of 13 October and used a stolen truck to break through a security gate, The Sun first reported.
The pair then fled with a pick-up and a quad bike that were stored in a barn.
The King and Queen were not in residence.
But the Prince and Princess of Wales, along with their three children George, 11, Charlotte, nine, and six-year-old Louis were believed to have been in their home, Adelaide Cottage, on the estate, according to The Sun.
The family moved there in 2022.
In a statement, Thames Valley Police said: “At around 11.45pm on Sunday 13 October, we received a report of burglary at a property on Crown Estate land near to the A308 in Windsor.
“Offenders entered a farm building and made off with a black Isuzu pick-up and a red quad bike. They then made off towards the Old Windsor/Datchet area.
“No arrests have been made at this stage and an investigation is ongoing.”
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On Christmas Day 2021, a man climbed a fence at Windsor Castle armed with a crossbow and claimed he wanted to kill Queen Elizabeth II.
Jaswant Singh Chail was handed a nine-year custodial sentence for treason, possession of an offensive weapon and making threats to kill.
The UK is braced for “disruptive snow” as yellow weather warnings cover large parts of the country until Tuesday – with the Met Office saying there is the “potential” for the alerts to be “escalated”.
The forecaster has warned up to 20cm of snow may accumulate in the worst affected areas as the country experiences its “first taste of winter”.
The Met Office has also told people to expect ice, cold temperatures and wintry showers this week.
Check the forecast in your area
A yellow warning for snow and ice is in place for much of the north of the country – covering areas in the East Midlands, Yorkshire, Wales and the north of England – from 7pm on Monday night to 10am on Tuesday morning.
Those in the impacted areas have been told power cuts are possible and mobile phone coverage might be affected.
The Met Office has said there is a “slight chance” some rural communities could be cut off and that bus and train services may be delayed or cancelled.
People are also warned to be careful not to slip or fall on icy surfaces.
The Met Office has said there will be bright spells across northern and eastern areas throughout today, but rain in the south and west will gradually spread northeastwards and turn to snow over northern hills.
Parts of the UK are experiencing their ‘first taste of winter’, says the Met Office. File pic: PA
Tom Morgan, Met Office meteorologist, said: “We could see some disruptive snow in the Pennine regions, in particular, the Peak District as well, especially Monday night, but we could well see some impacts lasting on until Tuesday morning’s rush hour.
“Even down to lower levels, we could well see some snow as well, so quite a bit of disruption possible by Tuesday morning, and then the week ahead is likely to stay cold nationwide, a windy day on Tuesday, and then winter showers through the week ahead.”
Mr Morgan said that despite a “mild” start to the month, the cold conditions are more typical of “mid-winter to late-winter”.
“What we can say is that it’s going to be very cold for the time of year, there will be widespread overnight frosts, and a few locations where there’s snow on the ground,” he continued.
The yellow weather warnings in place across the UK
Meanwhile, a yellow snow and ice weather warning that came into force at 4pm on Sunday will end at 11am this morning.
The warning covers the northern tip of Scotland and people there have been told there may be icy patches on some untreated roads, pavements and cycle paths.
The Met Office has said there is “potential” for both yellow warnings to be “escalated”.
In southern England, a typical maximum temperature for this time of year is 11C (52F), but daytime highs for the week ahead are forecast to be around 5C (41F), while some parts of Scotland will reach “only just above freezing”, Mr Morgan said.
The meteorologist said the public can best prepare for the wintry weather by checking their cars are suitable for icy and potentially snowy conditions and to take extra supplies including food, blankets and a fully charged mobile phone with them on journeys.
He added there were “likely” to be changes to the weather warnings in the coming days, and that “winter flurries” could be seen in the south of England later in the week.
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Despite the cold conditions, the “whole of the UK” will enjoy more sunshine this week, the meteorologist added.
He said: “There’ll be some snow showers in the peripheries of the UK, particularly northern Scotland, and down the east and the west coast, but if you live inland and you live in the south, there’ll be lots of sparkly blue skies on the most days through Tuesday to Friday.”
It comes as a cold weather alert issued by the UK Health Security Agency, which was introduced at 9am on Sunday, will be in place until 9am on Thursday.
It covers a large area of England, north of Northhampton. The alert is triggered when there is a risk that healthcare services might face extra pressure and is designed to prepare those who are “particularly vulnerable” and “likely to struggle to cope”.
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