The Office for National Statistics said on Wednesday that UK inflation fell to 3.2% in March.
That was slightly higher than the 3.1% forecast by economists polled by Reuters, but down from February’s 3.4%.
The ONS said food prices were the biggest downward drag on overall rates, while motor fuel pushed them higher.
The core figure excluding energy, food, alcohol and tobacco was 4.2%, compared with the forecast of 4.1%.
This week, investors have been watching for signs of a cooling in the UK labor market, with the unemployment rate unexpectedly rising to 4.2% between December and February. salary growth Meanwhile, the share excluding bonuses fell to 6% in February from 6.1% in January.
Bank of England Governor Andrew Bailey say tuesday He saw “strong evidence” that rising interest rates are curbing price increases, which have cooled from a peak of 11.1% in October 2022. Increase.
But a stronger-than-expected March core reading that came in solidly above 4% is likely to fuel speculation that inflation is more troublesome than recent forecasts suggest and that the first rate cut could be further delayed.
Current market pricing suggests that the Bank of England will implement two rate cuts in 2024 from the current rate of 5.25%, starting in August or September.Uncertainty over this timetable has now increased given signs of continued inflationary pressures in the United States
this GBP Higher against the US dollar Dollar and EUR After the news was announced, the exchange rate against the U.S. dollar rose 0.1% to $1.243; the exchange rate against the euro rose 0.15% to 1.1718.
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