LONDON - Britain’s annual inflation rate fell sharply to a 13-month low of 8.7 per cent in April, with energy prices much weaker than a year earlier, official data revealed on Wednesday.
The rate of price increases slowed from 10.1 per cent in March, bringing inflation under 10 per cent for the first time since August 2022, said the Office for National Statistics (ONS) in a statement.
At 8.7 per cent, it was the lowest level since March 2022, when the rate stood at 7 per cent.
“However, prices in general remain substantially higher than they were this time last year, with annual food price inflation near historic highs,” noted ONS chief economist Grant Fitzner.
Despite the sharp drop, April’s rate was above the Bank of England’s (BOE) prediction for inflation of 8.4 per cent in April.
Britain’s annual inflation rate in April was also the highest among countries in the Group of Seven rich economies which also include Canada, France, Germany, Italy, Japan and the United States.
The BOE’s target rate of 2 per cent remains very far off, while the British government has said it sees inflation dropping to about 5 per cent by the year end.
In April, “the rate of inflation fell notably as the large energy price rises seen last year were not repeated... but was offset partially by increases in the cost of second-hand cars and cigarettes”, Mr Fitzner added.
The data comes one day after the International Monetary Fund (IMF) delivered a major U-turn on its forecast for the British economy, saying it expected growth in 2023, just one month after predicting a contraction.
Britain’s economy is expected to expand 0.4 per cent in 2023, the IMF said in its latest outlook document, which cited weaker energy prices.
The IMF ripped up its previous forecast in April for a 0.3 per cent contraction.
Following Wednesday’s data, British Finance Minister Jeremy Hunt said: “The IMF said yesterday we’ve acted decisively to tackle inflation, but although it is positive that it is now in single digits, food prices are still rising too fast.” AFP
