"The ‘Easter effect’ will kick in this April, so expect a further lift in inflation when figures are released next month."
This means inflation is at its joint highest since September 2013.
CPIH, which the ONS are now using as their headline measure and which includes owner occupiers’ housing costs, shows a 12-month inflation rate of 2.3%.
The CPI 12-month rate was also 2.3% in March 2017, unchanged from February.
Rising prices for food, alcohol and tobacco, clothing and footwear, miscellaneous goods and services were the main upward contributors to change in the rate.
Maike Currie, investment director at Fidelity International, says the late Easter break this year compared to 2016 has kept price rises in check, however "the ‘Easter effect’ will kick in this April, so expect a further lift in inflation when figures are released next month".
Nick Dixon, Investment Director at Aegon, commented: “With inflation surpassing the Bank of England’s target for a second month running savers will begin to feel the pinch as inflation erodes the value of their hard earned cash and this poses a particular threat to pensioner income.
“A higher inflationary environment demands a review of investment strategies and advisers are well-placed to guide clients on how best to protect against inflation. Part of the solution lies in avoiding ‘return-free’ government bonds and using low volatility equity dividends as a core component of income planning. If the bulk of income comes from natural yield, capital volatility can become less important in the investor’s aggregate risk profile.”
