According to the report from the Office for National Statistics (ONS), consumer prices rose by 8.7% per annum in April after rising by 10.1% per annum in March. Economists had expected CPI growth by 8.2% per annum. UK inflation sinks below 10% for the first time since August. However, it still remains more than 4 times higher than the Bank of England's target level (2%). Economists broadly expect a further rate hike at its next meeting as inflation remains stickier in the U.K. than in comparable major economies, while the labor market has stayed tight
Electricity and gas prices contributed 1.42% to the fall in annual inflation in April as last April’s rise dropped out of the annual comparison. Food and non-alcoholic beverage prices continued to rise in April and contributed to high annual inflation, however, the annual inflation rate of food and non-alcoholic beverages eased to 19.1% per annum from 19.2% per annum in March.
Meanwhile, core CPI - which excludes energy, food, alcohol and tobacco - rose 6.8% per annum after an increase of 6.2% per annum in February. This was the strongest growth since at least March of 1992. Consensus estimates suggested an increase by 6.2% per annum.
On a monthly basis, the consumer price index rose by 1.2% after increasing 0.8% in March. It was the third monthly increase in a row and the strongest increase since October 2022. Economists had expected CPI growth by 0.8%.