Commenting on data from the Office of National Statistics, that showed the annual rate of CPI inflation rising from 10.1% in January to 10.4% in February, Kitty Ussher, Chief Economist at the Institute of Directors, said:

“February’s CPI inflation rate is higher than expected, driven predominantly by high monthly price rises in food, hospitality and clothing. Food price inflation is now running at 18%, up from 16.7% in January, not helped by a shortage of some salad and vegetable items in recent weeks. Clothing prices often rise in February as fresh stock is brought in following the new year sales, but this year the change was particularly steep. Cafes and restaurants meanwhile have been hit by the triple whammy of higher wage, energy and food costs forcing a rethink of their pricing strategies.

“In recent days some have suggested that the febrile environment in the banking sector should give central banks pause for thought before raising rates further. Today’s data suggests the opposite; the Bank of England’s job is not yet done.”