Inflation has risen to 3.5% in April, up from 2.6% in March.

Gus Williams, interim CEO at Chambers Wales South East, South West and Mid, said:

“Today’s pick up in inflation was largely expected and doesn’t change much; we know there are still pricing pressures on businesses.

“I believe the Bank of England will remain doveish on these pressures being caused by tax and wage changes for the time being and rates remaining on a downward course, however slow. Economic news and indicators are still mixed, with some good news sprinkled in with the ongoing challenges businesses are facing. It will be crucial to see if business and consumer confidence turns over the coming months from the doldrums of the first quarter – there is likely pent up demand and capacity in the economy on all fronts which is waiting for confidence to return.

“We should remain positive about the underlying strength of the UK as a place to do business and our long-term prospects. Brexit, Covid, skills shortages and the subsequent inflationary period have all required businesses to be resilient. A period of relative calm should allow businesses to focus on again on future investment.”

Responding to the latest inflation data, published by the ONS, Stuart Morrison, Research Manager at the British Chambers of Commerce, said:

“Businesses are facing a perfect storm of cost-pressures which is fuelling inflation alongside rising household bills. While April’s jump was expected, the scale, to 3.5%, is concerning.

“With the national insurance hike, minimum wage rise and global tariffs, our research shows 55% of businesses are expecting to put up prices in the coming months.

“Firms urgently need to see a clear tax roadmap identifying when the burdens of national insurance and business rates will ease. Upcoming strategies on industry, trade and infrastructure must live up to business expectations and help drive investment.

“On the global front, Monday’s UK-EU reset deal was good news for business. Coupled with recent trade announcements with the US and India, it provides a pathway to growth.

“But with inflation clouds gathering, the Government must accelerate efforts to help business, not ease off.”