Despite the climb in global energy prices since late February, last month\u2019s inflation reading will benefit from favourable base effects, which compare the price of goods and services today to those recorded in the same period in 2025. April is also when the government\u2019s measures to reduce energy bills through green taxation cuts was introduced, helping cut household energy costs. <\/p>\n
Electricity and gas price inflation is on course to drop by 6\u00a0per cent in April\u2019s figures, released on Wednesday, but will be matched by a similar increase in the rise in oil prices recorded last month, according to the Bank\u2019s forecasts. Food price inflation is expected to slow from 3.7\u00a0per cent to 3.4\u00a0per cent, and weaken from 4.3\u00a0per cent to 3.4\u00a0per cent in the broader services sector, according to the central bank\u2019s latest projections. <\/p>\n
Airfares could be the biggest drag on the headline rate of inflation due to the earlier timing of Easter this year compared with 2025. Rob Wood, chief UK economist at Pantheon Macroeconomics, said airfares were a \u201ckey swing factor\u201d for April\u2019s inflation figure and \u201cticket prices rose less in April this year than the Easter-boosted April 2025\u201d. <\/p>\n
\u201cWe expect year-over-year airfares inflation to tank to minus 6.6\u00a0per cent in April, from 14.5\u00a0per cent in March, subtracting 0.12\u00a0percentage points from headline consumer price index inflation,\u201d he said. <\/p>\n
At the start of the year economists had expected inflation to fall to the Bank\u2019s 2\u00a0per cent target rate by April but forecasts for prices have been ditched since the start of the US-Iran war. The central bank now expects inflation to pick up again during the summer and end the year at about 3.7\u00a0per cent, close to double its target.<\/p>\n
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A storage tank at National Grid\u2019s liquified natural gas plant in Kent. The Bank of England said that after a slowdown in April inflation will rise again as the Iran war pushes up energy costsPAUL HACKETT\/Reuters<\/p>\n
The UK has suffered from stickier inflation than its peers in Europe<\/a> as the economy continues to record some of the highest wholesale energy prices of any major economy. The Bank has published surveys showing that businesses expect to raise prices<\/a> charged to consumers as they grapple with higher oil prices and transport costs. <\/p>\n