There were signs that inflation may be starting to decline as two surveys reported easing price pressures among UK businesses.
The monthly gauge of industrial orders put together by the Confederation of British Industry (CBI) found that growth in average domestic prices and average costs per output unit had slowed for the fourth quarter in a row, with managers expecting further easing in the current quarter.
The Lloyds Bank UK Sector Tracker’s price-inflation measure also fell to 58.9 in March from 62.2 in February for UK manufacturers and service providers. The tracker also found supply chain performance to have improved, with fewer manufacturers reporting shortages of raw materials. Overall, 10 of the 14 considered sectors saw slowing growth in their total input prices.
The Head of Economics and Market Insight at Lloyd’s commercial banking division, Jeavon Lolay, said about the report:
“Our report shows a significant downward shift in price trends after a run of elevated, and accelerating, inflation. If businesses’ input cost and supply pressures continue to weaken, this should see consumer price inflation slow—as firms increasingly adjust prices based on the demand for their goods and services.”
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