Inflation leaped to 3.4 per cent in March, pushing through the government’s inflation target for the second time this year.
 
The increase is a result of higher prices for energy, fuel, air transport and food, according to the Office of National Statistics.

Most economists had predicted a rise to 3.1 per cent, only slightly up from February’s figure of 3.0 per cent.
 
Mark Bolsom, head of the UK trading desk at Travelex, said, ‘A weak pound and high energy prices are driving up the cost of imported goods. This data adds to the confusing economic outlook - on the one hand, we need a weaker pound to boost our export-led growth, but on the other hand, the UK is an import-based economy. There is a significant downside to a weaker pound, as illustrated by this data.

‘It calls into question the Bank of England’s prediction that inflation will subside naturally and there is no doubt that the markets will want clear direction from policymakers on how they intend to deal with the inflationary pressure.’