Surprise inflation rise intensifies pressure on business - Chamber

A surprise leap in inflation will further intensify cost pressures facing firms, business leaders said today.

The consumer prices index measure (CPI) of inflation rose to 10.4 per cent in February, up from 10.1 per cent in January, according to the Office for National Statistics.

The ONS said the largest upward contributions to inflation came from housing and household services - principally from electricity, gas and other fuels - as well as food prices and the rising cost of alcoholic drinks in pubs.

Greater Birmingham Chambers of Commerce said the figures add to the feeling that Chancellor Jeremy Hunt could have gone further to alleviate cost pressures in last week 's Budget.

Cameron Uppal (pictured), policy and public affairs adviser at GBCC, said: “It is worrying to see that CPI has risen in February especially given that we have seen inflation gradually easing since the record high in October.

“This unexpected rise is worrying not least because these latest figures contrast with the Chancellor's long-term projection announced in the Spring Budget of seeing inflation pressures easing throughout the year, but more so will be worrying for many local businesses who have expressed their concern over sustained high costs pressures since the start of the year.

“Our latest Quarterly Business Report indicated a real concern amongst local businesses around the erosive impact inflation costs are having on their businesses, with over a third of firms identifying inflation as the primary concern for their business.

“This morning 's results will simply add to the feeling that the Chancellor could have gone much further in last week 's Budget in a bid to tackle these ingrained cost pressures - ignoring the pressing need to reform business rates or a willingness to commit to more generous energy support if wholesale gas prices go up seems like a missed opportunity."