Sterling rises as investors eye United Kingdom inflation data

Posted March 21, 2017

The figures from the Office for National Statistics (ONS) showed food prices were rising again after 31 months in a row of year-on-year deflation. The Bank of England's target for inflation is 2pc.

Meanwhile, food prices had a small upward effect on inflation for the first time since 2014. Within this category, prices for motor fuels made the largest contribution, with prices increasing by 1.2% between January and February 2017.

Analysts are looking for a reading of 2.1% to be released, a notable increase on the previous month's 1.8%.

The new measure, the catchily named consumer prices index including owner occupiers' housing costs (CPIH), rose from two per cent in January to 2.3 per cent as well last month.

United Kingdom inflation surged once again in February, hitting 2.3% and passing the Bank of England's 2% for the first time in more than three years, according to the latest data released by the Office for National Statistics on Tuesday.

Food is becoming more expensive as producers begin to pass down soaring import costs triggered by the pound's slump since the European Union referendum result.

Robust consumer spending helped power economic growth in the final months of previous year, with gross domestic product (GDP) expanding by 0.6% in the fourth quarter, in line with the second and third quarters.

The Bank of England has said it expects inflation will peak at 2.8% next year.