UK inflation hits 3.3% as Iran war drives fuel costs higher

Inflation in the U.K. climbed in March after a sharp jump in prices at the petrol pump in the wake of the disruption to energy supplies caused by the Iran war , official figures showed Wednesday.

Inflation Rises

The annual consumer price inflation rate increased to a three-month high of 3.3%, from 3% the previous month, according to the Office for National Statistics. The rise was in line with market expectations.

Fuel Price Impact

The main reason behind the inflation spike was higher motor fuel, which increased by a monthly 8.7% — the largest increase since June 2022, shortly after the Russian invasion of Ukraine. Airfares and food prices, both related to the spike in energy prices, were also higher.

Government Response

Treasury chief Rachel Reeves, whose hopes over the cost-of-living have been blown off course by the crisis in the Middle East, said this is “not our war, but it is pushing up bills for families and businesses” as a result.