Inflation falls to 2.8% in April

Inflation dropped to a lower than expected 2.8% in April as falling gas and electricity bills helped offset rising transport costs.

According to data released by the Office for National Statistics (ONS), housing and household services provided the largest downward pressure on the headline rate. The correction followed a reduction in the Office of Gas and Electricity Markets energy price cap, alongside unit price cuts implemented through the government energy bill announcement.

Average household electricity prices fell by 8.4% in April, while gas prices dropped by 4.4%. The regulatory price cap fell primarily because global wholesale energy prices reduced during the 12-week assessment period between 15 November 2025 and 13 February 2026.

Recreation and culture prices further aided the decline, with the division’s annual rate falling to 1.7% from 2.8%. The shift reflected a downward trend in package holiday and airfare costs, driven by the timing of Easter falling outside the April statistical collection window.

Food and non-alcoholic beverage inflation slowed to 3.0% in the 12 months to April, down from 3.7% in March, led by price easing across meat, confectionery, and coffee.

These downward trends were partially offset by a sharp rise in transport costs, driven by a rebound in global oil markets. Motor fuel prices rose by 23.0% in the 12 months to April, compared with a 4.9% increase in March.

Average petrol prices rose by 16.6 pence per litre month-on-month to reach 156.8 pence per litre, the highest level recorded since November 2022. Diesel prices increased by 31.3 pence per litre to reach 190.0 pence per litre.

Core inflation metrics, which exclude volatile energy, food, alcohol, and tobacco prices, also registered declines. Core consumer prices index inflation dropped to 2.5% in April from 3.1% in March.

Commenting on the inflation figures for April, ONS chief economist Grant Fitzner said: “There was a notable fall in annual inflation led by lower electricity and gas prices. This was due to the Government’s energy bill support package reducing variable and fixed tariffs, along with lower global wholesale energy prices before the conflict in the Middle East, which fed through to the reduction in the Ofgem cap.

“Smaller rises in water and sewage bills and Vehicle Excise Duty than seen last year also helped pull the rate down. Food prices, particularly for chocolate and meat products, and the price of package holidays drove inflation down further.”

He added: “These were only partially offset by a further increase in petrol and diesel prices, and an uptick in the cost of clothing and footwear.   The annual cost of both raw materials and goods leaving factories continued to rise, driven again by higher crude oil and petrol prices.”