Inflation could rise to a new record

The squeeze on household budgets tightened in March as rapidly rising food and fuel prices sent inflation to another 30-year high – even before energy bills spiked.

The Office for National Statistics (ONS) said Consumer Prices Index (CPI) inflation rose to 7% in March – up from 6.2% in February and the highest since March 1992, when inflation stood at 7.1%.

ONSchiefeconomistGrant Fitzner, said: "Broad-based price rises saw annual inflation increase sharply again in March.

"Amongthelargestincreases were petrol costs and furniture."

He also pointed out steep jumps in restaurant and hotel prices while the cost of many food items rose.

The data shows the price of clothes and shoes rose by 9.7% intheyeartoMarch,furniture, householdequipmentjumped 10.4%whilefoodandnon-alcoholic beverages were up 5.9%.

March's inflation does not take into account the average 54% hike in energy bills two weeks ago.

This will not appear in next month’s figures, which are expected to show another jump.

Jack Leslie, senior economist at the Resolution Foundation think tank, said: "With ONS data showing that wages are not keeping pace with rising prices, Britain's cost-ofliving crisis will continue to worsen before it starts to ease at some point next year."

The Bank of England has predicted that inflation could peak at around 8% in April as the new energy prices are factored in.

Chancellor Rishi Sunak said: "We're seeing rising costs caused by global pressures in our supply chains and energy markets which could be exacerbated further by Russian aggression in Ukraine."