The Consumer Prices Index (CPI) jumped to 3.5% in April from 2.6% in March as a swathe of price increases on everything from energy prices to council tax and private school fees kicked in.

The rise was above forecasts and will make the Bank of England’s job in limiting inflation to 2% harder.

Annual CPI is above 3% for the first time since March 2024.

One of the biggest increases was seen in education costs, up 7.5% on a 12 month basis, as VAT was added to private school fees.

The sister Consumer Prices Index including owner occupiers' housing costs (CPIH) leapt by 4.1% in the 12 months to April 2025, up from 3.4% in the 12 months to March. 

ONS said that on a monthly basis, CPIH rose by 1.2% in April 2025, compared with a rise of 0.5% in April 2024. On a monthly basis, CPI rose by 1.2% in April 2025, compared with a rise of 0.3% in April 2024. 

ONS said that the largest upward contributions to the monthly change in both CPIH and CPI annual rates came from housing and household services, transport and recreation and culture. The biggest downward contribution to inflation came from clothing and footwear. 

Core CPIH (CPIH excluding energy, food, alcohol and tobacco) rose by 4.5% in the 12 months to April 2025, up from 4.2% in the 12 months to March while the CPIH goods annual rate rose from 0.6% to 1.7%.

The CPIH services annual rate rose from 5.4% to 5.8%.

RPI (the Retail Prices Index), the older measure of inflation, increased from 3.2% in March to 4.5% in April.

Commentators said the rise in CPI may be a blip but it could take time to keep inflation under control.

Alexandra Loydon, director of advice at wealth manager St James’s Place, says: “While the Bank of England’s May interest rate cut may have offered some short-term relief to consumers, today’s higher than expected rise in inflation to 3.5% has likely brought this optimism to a halt. Although this increase was expected, driven by April’s rise in household bills, it is no less concerning for consumers who continue to grapple with mounting financial pressures.

“Our recent research reveals the extent of this strain, with a quarter of the population (25%) feeling anxious about the year ahead and six in ten (58%) reporting that they do not feel financially comfortable. Today’s figures will do little to ease this pressure, and while the Bank of England is expected to cut rates by one or two quarter points before the end of the year, the timing of these reductions is becoming increasingly uncertain. As a result, borrowers and mortgage holders are lacking any reassuring clarity.

“The situation also remains complicated for savers. Indeed, while rates on easy access accounts are starting to fall significantly, today’s inflation figure is expected to mark the start of a prolonged period of inflation above 3%. It is therefore vital that savers stay alert and ensure that they are taking advantage of the most competitive savings rates available. For those saving for the longer term, investing can be a smart way to boost income further, just be sure to diversify your investments to spread risk and protect against market volatility.”

Luke Bartholomew, deputy chief economist, at Aberdeen said: “Inflation was always going to jump higher today given movements in energy and other administered prices, but the reported increase is bigger than expected. In particular, services inflation looks especially strong, which may suggest the various cost shocks such as the increases in National Insurance and the living wage are hitting firms and starting to be passed on into final prices.

"Certainly, this will reinforce the concerns voiced by BoE chief economist Huw Pill that underlying inflation pressures are sticky and so there is less room for the Bank to cut rates. Nonetheless, we think a quarterly profile of rate cuts remains appropriate, but the chance of the easing cycle speeding up any time soon has fallen.”

Financial Planning Today Analysis: Today's inflation news will come as a not-unexpected disappointment to a government trying to keep a lid on inflation and raise living standards. It will also disappoint the many retirees who have seen pension increases of only 3% or less this year. The increase, however, on the back of a large number of annual increases in everything from alcohol duties to VAT on school fees was predictable, although higher than expected. It will take time for the inflation spike to subside but with expected decreases in energy costs in July and many of the annual increases now out of the way it is hoped inflation will fall back over the coming months. In the meantime, the challenge for many Financial Planners with retired clients is how to plan for a sticky inflation rate which seems difficult to control over the medium term. This may have longer term implications for retirement planning.