The UK is experiencing a surge in inflation, driven by an increase in household bills. Official data shows that inflation rose to 3.5% in April from 2.6% in March. Water, gas, and electricity prices rose on April 1st, along with various other bills, surpassing the Bank of England’s 2% target. The Office for National Statistics stated that the main contributors to the increase were from housing and household services, transport, and recreation and culture.
Despite economists predicting a lower rate, April’s inflation rate came in higher than expected. The Bank of England anticipates a peak in inflation at 3.7% between July and September 2025 before reverting to the 2% target. Energy and water bills, along with slightly higher food prices, impacted households in April. The increase in costs also affected businesses, with rises in employer National Insurance contributions and the minimum wage.
The ONS reported a notable 26.1% increase in water and sewerage prices in April, the largest rise since at least February 1988. Services inflation rose by 5.4% in the year to April due to adjustments in National Insurance Contributions for employers and higher minimum wage rates. The UK’s economy heavily relies on services, such as dining out, getting haircuts, or going to the movies, rather than producing goods.
Grant Fitzner, the acting director general of the ONS, highlighted how significant increases in household bills led to the steep climb in inflation. Chancellor Rachel Reeves expressed disappointment with the figures, attributing April’s minimum wage hikes and the decision to hold fuel duty constant in alleviating the cost of living. However, shadow chancellor Mel Stride described the inflation rate as concerning for families, blaming Labour’s economic policies for exacerbating the situation
Read the full article from The BBC here: Read More
