- Prior +3.0%
- Core CPI +3.1% vs +3.2% y/y expected
- Prior +3.2%
UK headline annual inflation picked up in March as higher energy price inflation feeds into price pressures on the month. The monthly estimate sees a 0.7% jump in headline inflation, with transport prices being the main driver.
Of note, transport prices were seen up to 4.7% compared to a year ago with the annual rate being the highest since December 2022. The largest upward effect came from motor fuels with the average price seen at 140.2 pence per litre in March, the highest price since August 2024. Meanwhile, diesel prices also jumped up with the average price seen at 158.7 pence per litre in March, the highest price since November 2023.
Overall, motor fuels inflation rose to its highest since January 2023 as it records a 4.9% estimate last month.
Looking over to core prices, the impact from the Middle East conflict will eventually have a stronger impact in the months ahead. But for March, we are yet to see any evidence in this space. Core annual inflation is seen easing slightly to 3.1% in March but services inflation remains a very stubborn area with it rising to 4.5% from 4.3% previously.
