| The Consumer Prices Index (CPI) has risen to 3%, with the Retail Prices Index (RPI) reaching 4.2%, sparking concern amongst business groups that interest rates will not be cut next month.
Analysts had expected the CPI to rise by only 0.1% on March's figure of 2.5%, the reality is the biggest rise in the CPI since May 2001. The RPI rose by 0.4% from last month's figure.
The Bank of England's Monetary Policy Committee (MPC) will need to balance the risk of further inflation against the pressure of a slowing economy when it meets to discuss interest rates next month.
"Coming after yesterday's sharp increases in producer price inflation, today's figure will inevitably increase the reluctance of some MPC members to consider early interest rate cuts," stated David Kern, Economic Adviser to the British Chambers of Commerce (BCC).
"Without a modest cut in interest rates to 4.75% in June, the risk of a severe economic downturn would intensify. The immediate threats to growth remain more serious than the risks of higher inflation."
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