The UK inflation, as measured by the Consumer Prices Index, rose to 0.5 percent in March 2016, according to the Office for National Statistics.
Although the rate has increased gradually since last October – reaching 0.3 percent in February – in terms of historical context it is still relatively low.
A rise in the cost of flying and clothing are considered the main contributors, increasing the rate between February and March 2016. These upward pressures were partially offset by a fall in food prices and a smaller rise in petrol prices than a year ago, according to the Office for National Statistics.
Commenting Mike Cherry, national chairman at the Federation of Small Businesses (FSB), said: “Small firms are currently dealing with a raft of challenges, including the National Living Wage which came into effect this month, driving up costs and driving down modest profit. A recent FSB survey showed small business confidence hovering at its lowest level since 2013. Despite inflation edging up last month, our members welcome this ongoing period of low inflation which has helped to keep other operating costs manageable.
“Given today’s figures and the challenging economic outlook, we urge the Bank of England to remain cautious when considering whether to raise interest rates at its meeting later this week.”