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22 Mar 2023

Surprising rise in inflation provides stark warning to Government over economy, says East Midlands Chamber

Commenting on the latest inflation data from the Office for National Statistics today (22 March), East Midlands Chamber chief executive Scott Knowles said: “After the economic difficulties of recent months had appeared to be easing slightly, these latest figures should provide a stark warning to Government, as an unexpected rise in the Consumer Price Index rate to 10.4% indicates we are still in the midst of a stubborn inflationary peak.

“With Producer Price Index inflation at a near-historic high of 12.7%, this illustrates how businesses are still absorbing many of the cost pressures they have experienced across labour, energy, raw materials and fuel for 18 months now.

“We have always said this is unsustainable, however, and the latest research via our Quarterly Economic Survey shows that more than half of East Midlands businesses expect they will be forced to raise their own prices over the next three months.

“The longer this goes on, the greater the impact on businesses and consumers as much higher prices become the norm.

“The Spring Budget offered little in the way of support for these cost pressures facing firms, but there are still steps the Government can take to ‘get the basics right’ for businesses, as we have outlined in our Business Manifesto for Growth.

“This could involve improving our trading relationships with international markets to ease supply chain difficulties and incentivising companies to invest in upskilling their people to boost productivity.”