Fuel prices impact inflation

INFLATION nudged up 0.1% in February to 2.8%, partly due to higher fuel bills.

It’s the first time the Consumer Prices Index (CPI) measure of inflation has increased in four months after being stuck at 2.7%.

The Office for National Statistics said the largest upward contributions to the change in the rate came from the expected increases in many gas and electricity bills, and from price changes for some recreational goods, motor fuels and air transport.

The largest downward contributions came from smaller price increases for food and soft drinks than a year ago and price falls for alcohol compared with price rises a year ago.

Ian O’Donnell, Warwickshire & Coventry Chairman, Federation of Small Businesses, said: “With low value of the pound and the ever-increasing cost of energy and fuel the rise in inflation is not surprising but we are concerned that it is at its highest level since May 2012. We would urge the chancellor to cancel the 3p fuel duty rise in tomorrow’s Budget to give confidence to businesses and households.”