UK inflation is expected to rise again after household bills saw a sharp increase in April.
The latest data, which tracks the annual change in prices, is due to be published at 07:00 BST. Economists believe the rate may climb from 2.6% in March to 3.3%, driven largely by higher costs for water, electricity, and gas.
Last month, millions of households felt the impact of rising utility bills. New price caps and adjustments took effect on 1 April, pushing up monthly expenses for essential services. While wages also increased in April, with the National Minimum Wage and National Living Wage both going up, this has been met with growing business costs, including higher National Insurance contributions. Many companies are likely passing these costs onto consumers, making everyday goods and services more expensive.
Inflation tracks how fast prices are rising across the economy. In March, it dropped slightly due to falling petrol prices. But this relief appears to be short-lived, as utility prices and other living costs have now surged. If predictions prove accurate, April’s inflation rate will move even further away from the Bank of England’s target of 2%.
The Bank has warned of more inflation ahead, projecting a peak of 3.7% between July and September before a possible return to the 2% target. Policymakers are watching closely as price pressures continue to affect both households and businesses. A mix of global events, such as the war in Ukraine and the lingering effects of the pandemic, have contributed to economic uncertainty and disrupted supply chains. Rising wages in a tight job market have also played a part in pushing prices higher.
Chancellor Rachel Reeves has said that the UK is well-positioned globally when it comes to trade, but for many families, the focus remains on the rising cost of living. Despite wage increases, inflation means that things still cost more than they did a year ago — and may keep getting more expensive in the months ahead.
The upcoming inflation figures are more than just numbers; they reflect the daily reality for households balancing budgets amid rising costs. As utility bills rise and businesses adjust to new financial pressures, consumers are left to deal with the growing strain on their wallets.