February inflation holds at 3%, but energy shock clouds the outlook

Martin Beck, Chief Economist | Economic Consulting and Analysis

UK inflation held steady at 3% in February, with core inflation rising slightly to 3.2%. A sharp rise in energy prices, driven by Middle East tensions, is likely to push inflation up. Despite this, tighter monetary policy and a softer labour market suggest inflationary pressures will likely be transitory this time, with lower growth and higher unemployment bearing the burden.