- UK CPI up to 3.5% for the year to April 2025 – the last time it was higher was in January 2024
- Bill increases mostly behind the jump, with water and sewerage costs up by most since at least February 1988
- Falls in price of clothing and fuel partly offset the increases
Danni Hewson, AJ Bell head of financial analysis, comments on the latest UK inflation figures:
“Everyone knew it was coming. We all got those emails and brown envelopes from mobile providers, water companies and energy suppliers, but the jump in headline CPI to 3.5% was higher than expected.
“Although increases to benefits and wages will have gone someway to offset those rises, for households still trying to put the pieces back together after years of price hikes all those bill increases coming at once will have been pretty tough to take. The timing of Easter exacerbated some of the hikes, with flight prices shooting up as parents took advantage of the late school holidays.
“There were a couple of bright spots with the price at the pump down and retailers, still dealing with a post-Christmas hangover, reaching for the red pen to discount women’s shoes and kids’ clothing.
“What people really want to know is what happens next. The answer to that is difficult to fathom as we wait to see how recent trade deals impact prices, whether Donald Trump can strike other agreements to prevent further tariff disruption, and whether UK businesses are compelled to pass on increased labour costs to their consumers.
“The strength of the pound will help make our money go further when it comes to all the goods we import from around the world and concerns about the global economy have suppressed the price of oil.
“The Bank of England previously forecast inflation to peak at 3.7% in the summer before ebbing away, back to the Bank’s 2% target. But expectation of further rate cuts has been dialled down today with markets pretty much pricing out any chance of a June rate cut and only pricing in a 40% chance that rate setters will make a move in August.”
