U.K. inflation accelerated again in February, CPI 10.4% vs 9.9% expected
2023.03.22 03:30
© Reuters.
By Geoffrey Smith
Investing.com — Inflation accelerated again in the U.K. in February, disappointing hopes for a slowdown and piling on the pressure on the Bank of England to keep raising interest rates despite the growing risk of financial instability.
The rose 1.1% on the month, well above the 0.6% rise expected, taking the headline rate back up to 10.4% from 10.1%. Analysts had expected it to fall below 10% for the first time since August.
The numbers come a day before the is set to announce its latest policy decisions, and greatly increase the risk of another increase in interest rates.
Simon French, chief economist with stockbrokers Panmure Gordon, tweeted that “Whilst there will be an argument for holding the U.K. rate at this week’s Monetary Policy Committee meeting given recent financial sector turbulence, this probably tips the balance for a data-dependent BoE towards 25bp.”
“The largest upward contributions to the monthly change came from restaurants and cafes, food, and clothing,” the Office for National Statistics said in a statement accompanying the numbers. It noted that these rises were “partially offset” by downward pressure from petrol and diesel and from recreational and cultural goods and services.
