Inflation eases but stays above 10%

Consumer price inflation in the UK has remained above 10%, prompting predictions of another hike in interest rates next month. Annual consumer price inflation fell slightly to 10.1%, down from 10.4% in February. However, analysts expected a decrease to around 9.9%. Traders are now expecting the Bank of England to raise the base rate to around 4.5% next month, with interest rates likely to hit 5% by the end of the year. It is estimated that a peak of 5% would mean an extra £1,000 in mortgage costs for nearly three million homeowners. The Office for National Statistics said that food and drink price inflation sped up in March, growing by 19.2% year-on-year, following an 18.2% rise in February. The Times (£)The Telegraph (£)The Guardian