Inflation rate increases

The squeeze on household budgets tightened further last month as official figures revealed increases in energy and fuel costs sent inflation to its highest level since last May.

The Office for National Statistics (ONS) said Consumer Prices Index (CPI) inflation rose to 2.8 per cent in February, ending a four-month run at 2.7 per cent as the last of the major energy providers pushed through gas and electricity price rises.

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Higher petrol costs also contributed to the increase in the inflation rate.

The revelation was seen as put ting further pressure on Chancellor George Osborne ahead of today’s Budget as CPI edged even higher above his 2 per cent target.