UK inflation spikes as retailers respond to lockdown easing

Britain’s inflation rate more than doubled in April as energy prices soared and clothing retailers hiked prices as the country's coronavirus lockdown was eased, official statistics showed Wednesday.

The Office for National Statistics said consumer prices rose 1.5% in the year to April from 0.7% in March. The increase takes consumer price inflation up to its highest level since March last year, when the country first started to be affected by the coronavirus pandemic.

The statistics agency said sharp rises in domestic energy prices and transportation costs lay largely behind the inflation spike. It also said clothing retailers increased prices last month when they were allowed to reopen their doors on April 12.

The latest figures have accentuated concerns that Britain and other countries may face rising inflation as the world emerges from the pandemic and economic activity picks up at a time when central banks are keeping interest rates at historic lows and continue to print new money.

“We do not believe that higher inflation will be fully transitory as many in markets contend and as global central bankers seem to presume,” said Kallum Pickering, senior economist at Berenberg Bank. “The rebound marks a turning point for inflation across the advanced world following more than a decade of disinflation.”