Business groups, including the Confederation of British Industry (CBI), the Federation of Small Businesses (FSB) and the British Chambers of Commerce (BCC) have commented on the latest data published by the Office for National Statistics (ONS), which revealed that inflation rose to 7% in the year to March.
Alpesh Paleja, Lead Economist at the CBI, warned that the latest rise 'will not be the last'. He said: 'We'll see another jump over April, as the rise in Ofgem's energy price cap comes into effect. Beyond this, volatility in global commodity prices and ongoing supply chain disruption will continue to stoke price pressures. The result will be even higher costs for businesses, and a deep squeeze in the cost-of-living for households.'
The FSB stated that lots of UK small businesses 'are left with no choice but to put up prices'. Martin McTague, Chair of the FSB, said: 'The cost-of-living crisis starts with a cost of doing business crisis.
'Surging input price inflation for firms comes on top of rapidly rising energy costs, emergency debt repayments kicking in, tax increases and the end to COVID support measures, not least targeted VAT relief.'
The BCC suggested that soaring inflation has 'raised the prospect of a notable slump in economic output'. The business group said: 'The government must provide urgent financial support through the expansion of the energy bills rebate scheme to include small firms and energy intensive businesses, and an SME energy price cap to protect smaller firms from some of the price increases.'