UK inflation slows to 2.6% in March, ONS says

LONDON, April 16 (Reuters) - British inflation slowed to an annual rate of 2.6% in March from 2.8% in February, official figures showed on Wednesday.

A Reuters poll of economists had pointed to a reading of 2.7% in March, in line with the Bank of England's forecast which was published in February.

The BoE's most recent forecasts showed inflation peaking at 3.7% in the third quarter of 2025 - nearly double the central bank's 2% target - driven mostly by energy costs and regulated tariffs for household utility bills and bus fares.

Since those forecasts were made, U.S President Donald Trump's decision to impose sweeping trade tariffs have raised the prospect of a slowdown in the global economy.

BoE Deputy Governors Clare Lombardelli and Sarah Breeden and Monetary Policy Committee member Megan Greene have all said it is too early to judge the inflation implications resulting from Trump's moves.

Despite a slowdown in price growth from levels above 11% in 2022, inflation in Britain continues to be a concern for consumers.

Inflation expectations among the public and business have risen, adding to unease among BoE policymakers who are keeping a close eye on other gauges of price pressures in the economy as they assess when to reduce borrowing costs.

Ahead of Wednesday's inflation data release, financial markets had almost fully priced in the BoE's benchmark Bank Rate falling to 4.25% from 4.5% at its next scheduled monetary policy announcement on May 8.