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17th April 2024

Inflation heading in the right direction

Inflation has fallen to 3.2% according to the latest data from the ONS.

Paul Butterworth, CEO at Chambers Wales South East, South West and Mid, said:

“Today’s figures show that inflation is continuing to head, albeit gradually, in the right direction. At 3.2%, inflation is at its lowest rate in over two years and core inflation has also eased. This is good news for businesses and consumers.

“However, uncertainty remains and the rate is yet to meet the target of 2%. In our Quarterly Economic Survey for Q1 of 2024, over two thirds of businesses in Wales (67%) stated that, in terms of external factors, inflation was a key concern. Businesses will now be keen to see how the latest fall in inflation will affect upcoming interest rate decisions.”

 David Bharier, Head of Research at the British Chambers of Commerce, said:

“Today’s figures confirm inflation is continuing to slowly head in the right direction. That’s good news for both consumers and businesses.

“However, a lot of uncertainty remains among the firms we speak to. Our most recent Quarterly Economic Survey showed almost half of firms in fact expect their prices to rise over the next three months. Labour costs are cited as the main driver, but increasing political and global uncertainty is becoming a key factor.

“Businesses will be keen to see how this data translates into changes on interest rate policy. More than a third of SMEs we surveyed at the start of the year have seen increased borrowing costs because of the current interest rate.

“Business conditions more generally remain challenging, and firms need to see a clear long-term vision for the UK economy from politicians.”

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