UK inflation remains highest in Western Europe

In March, the annual inflation rate in the UK fell slightly compared to February, but still failed to fall below the psychological mark of 10%. By data National Statistical Service of Great Britain (ONS), in March inflation in the country amounted to 10.1%. And this is the highest figure among the countries of Western Europe and the countries included in the G7.

Inflation in the UK peaked in October 2022 at 11.1%, the highest in 41 years, and has been steadily, albeit slowly declining in the following months. Economic analysts in the City of London predicted that it would drop to 9.8% in March.

As noted in the ONS report, housing and utilities prices rose the most – by 26.1%. Food and non-alcoholic beverage prices soared 19.2% year-on-year in March, the biggest increase since August 1977. Bakery products and cereals went up the most – by 19.4%, and this is the most significant increase for the entire time of collecting such data, that is, since January 1989. Prices for fruit, chocolate and confectionery also increased significantly.

Taking into account the persistently high level of inflation, experts predict that at the next meeting on May 11, the Bank of England will decide on a new increase in interest rates, which were raised by 25 basis points in March, to 4.25%. According to analysts cited The Guardianthe rate can be raised to 4.5%, and by autumn – up to 5%.

Alena Miklashevskaya