Food prices in the UK rose at the fastest pace in 45 years last month, keeping inflation above 10 percent for a seventh straight month.
Food prices jumped 19.2 percent from a year earlier, the biggest increase since August 1977, the British Office for National Statistics (ONS) said yesterday.
Overall, consumer price inflation eased to 10.1 percent, from 10.4 percent the previous month, as the cost of gasoline and diesel fell. Last month’s figure was above the 9.8 percent rate economists had forecast.
“Inflation eased slightly in March, but remains at a high level,” ONS chief economist Grant Fitzner said. “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,” Fitzner said.
However, this was “partially offset by the cost of food, which is still climbing steeply,” he said, adding that bread and cereal inflation hit a record.
The British government and the Bank of England are struggling to prevent price increases from becoming embedded in the economy.
While the UK’s inflation rate has remained above 10 percent for eight of the past nine months, inflation slowed to 5 percent in the US and 6.9 percent in the countries sharing the euro last month.
Double-digit inflation has led to strikes from public-sector workers, including doctors, nurses, teachers, civil servants and train drivers, whose wages are being eroded by the rising cost of living.
The central bank has approved 11 consecutive interest rate increases in an effort to tame inflation. That pushed the bank’s key interest rate to 4.25 percent last month, from just 0.1 percent in December 2021, raising borrowing costs for consumers and businesses.
The Bank of England’s next decision is due next month.
“The [inflation] drop is too modest for the [central bank] to stop raising rates; we now look for a final 25 basis-point hike,” Pantheon Macroeconomics Ltd analyst Samuel Tombs said.
Additional reporting by AFP
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