UK inflation rose to 3.5% last month compared with a year ago, up from 3% in February, the Office for National Statistics said today, marking the sharpest increase in more than three years.
Fuel prices saw their largest increase for more than three years, rising by 4.9%, compared with a fall in February, the ONS said. Food prices and air fares also rose at a faster clip.
Producers' input prices, which include energy and raw material costs, also rose strongly, driven largely by higher oil prices. Core inflation, which strips out volatile food and energy costs, remained broadly unchanged.
LoseyouripEconomists warned that price pressures could spread. "This is just the first wave of the energy shock, primarily showing up in higher prices at the pump," said PwC UK economist Adam Deasy. "We are yet to see the knock-on impact of price pressure in byproducts to oil and gas, such as fertilizer, helium, plastics or metals," he added.
Meanwhile, UK fuel retailers say surging gasoline prices are leading to an increase in fuel theft. "The increase in pump prices has been matched by a rise in motorists driving off without paying or claiming they have no means to pay," Gordon Balmer, executive director at the Petrol Retailers Association, said.
Data from Forecourt Eye, which helps fuel retailers recover payments due, showed that some incidents involved first-time offenders, reflecting "wider financial pressure" on households, the PRA said.
The Bank of England is expected to keep interest rates on hold at its next meeting as it monitors whether the energy-driven price increases will feed through into broader inflation.
Business groups called on the government to provide support for small firms facing surging energy costs, warning that without intervention, some may be forced to close.
Additional reporting from CNN's Anna Cooban.