UK consumer inflation rises to 3 ½-year high of 2.7 percent

MMM and other Ponzi schenes

MMM and other Ponzi schenes

"Such spending will get harder to maintain as inflation remains above 2%, and perhaps goes even higher, and so cuts into the growth of wages and living standards in real terms".

"It is now hard to see where a pay revival in Britain will come from", said Martin Beck, an economist with consultancy Oxford Economics.

The ONS said workers' total earnings including bonuses rose by an annual 2.4% in the first quarter of 2017, edging up from growth of 2.3% in the three months to February and in line with the forecast in the Reuters poll of economists.

Matt Whittaker, chief economist at the Resolution Foundation, said: "Having hovered close to zero back in 2015, inflation has really picked up in 2017, doubling in the last six months alone and now at its highest level for nearly four years". These were partially offset by a drop in the price of motor fuels over the month in April.

In its inflation report last week the Bank of England said that CPI would peak at three per cent later this year as the pound's slump since the Brexit vote causes price tags on everyday items to tick higher. Those data hint that while the inflation surge is fading, sustainable price growth, driven by improving domestic demand, is in the pipeline.

The consumer price inflation is well within the limit of 2 to 6 per cent, prescribed by the Reserve Bank of India (RBI).

One reason for analysts' gloominess over pay is Britain's stubbornly poor productivity.

The ONS figures from the manufacturing sector showed output fell 0.6 per cent in March, but recent industry surveys have painted a brighter picture.

Alibaba quarterly profits almost double to $1.55 bn
China's top e-commerce firm also announced a two-year share repurchase program of up to $6 billion. It reported adjusted earnings of 63 cents a share, missing the consensus of 66 cents (4.53 yuan).

Some experts though are not so optimistic on the future wage growth. May's party then included campaigns and promises to place a cap in energy prices.

Unemployment fell to its lowest rate in more than four decades at 4.6 percent.

Scott Bowman, UK economist at Capital Economics, said the latest sharp uptick in the inflation rate was mainly due to a series of one-off factors, such as the timing of Easter.

The employment rate hit was 74.8 percent, the highest since records began in 1971.

Overall, the data is likely to bolster the BoE's decision to keep interest rates just above zero.

In the months ahead, he expects inflation to hover around 4 percent or slightly higher amid volatile fuel prices.

Meanwhile, the food sub-index increased by 2.04 percent in April, down by 0.17 percent points from 2.21 percent recorded in March.

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