Inflation fell for the first time this year in April, official statistics show – but economists warn this is merely the calm before the storm.

The Office for National Statistics reported on Wednesday morning that annual consumer price rises fell from 3.3 per cent in March to 2.8 per cent in April.

That’s largely because government measures to lower energy costs kicked in, helping lower household bills, if only temporarily.

In response to fresh inflation data from the ONS, Chancellor Rachel Reeves said: “The war in Iran is not our war but one we will need to respond to, and the decisions I took in the Budget last year have kept inflation down as we deal with global instability.

“We have the right economic plan, and to change course now would risk our economic stability and leave working people worse off.

“We have already taken £117 off energy bills, frozen rail fares, and lifted the two-child limit, and over today and tomorrow I’ll set out the next phase of how we will support UK households.”

But economists fear the drop in inflation may be short-lived. Suren Thiru, chief economist at chartered accountants institute the ICAEW, said: “April’s slowdown is a final interlude before the inflation storm sparked by the Iran war hits as the Ofgem energy price cap reduction, aided by the chancellor’s cut to green levies, temporarily lowered the headline rate.

“This decline is probably the last inflation fall for this year as surging fuel and food prices will probably haul it close to 4 per cent this summer, while any escalation of the conflict in Iran opens the door to CPI hitting 5 per cent.”

Danni Hewson, head of financial analysis at AJ Bell, said: “The problem with today’s inflation data is that it is backwards looking and households struggling to stretch their budgets to fit the rest of the year are hyper aware that the picture painted by April’s numbers is a rose-tinted anomaly. Whilst motorists have already experienced a hefty rise in the price they’ve been paying at the pump, the true impact of the energy price shock created by the Iran war will take a few months to really work its way through the system.”

Rising prices are the top financial concern for UK households, recent surveys show.

S&P Global’s consumer sentiment index figure dropped to 42.1 in May, from 42.3 in April, the lowest level since July 2023 when inflation in the UK was soaring as a result of the Russian invasion of Ukraine.

On Tuesday, the UK unemployment rate rose to 5 per cent in the three months to March from 4.9 per cent. That could also be a sign of further job cuts to come as employers look to cut costs.

Ms Hewson said on inflation: “April’s figures are further skewed by the energy price cap, which includes a big dollop of government help as it shifts the burden of renewables onto general taxation and away from bills. Put simply, this is the calm before a summer storm with energy bills, food prices and a whole host of other costs expected to shoot up over the coming months. With wage growth slowing in a tepid labour market to boot, things are likely to feel tough for a lot of people still reeling from their last brush with high inflation.”

Indigenous bullet train at 350 kmph! Railway Minister Ashwini Vaishnaw on Tuesday said India’s next-generation bullet train is being planned with a top speed of 350 kilometres per hour. He added that work on the train’s design is expected to commence within the next six months.The 508-kilometre Mumbai-Ahmedabad High-Speed Rail Corridor, launched in 2016, is currently under construction and is intended to support trains running at speeds of up to 320 kmph. The first phase of operations is expected to begin in August 2027.India’s first bullet train is currently being manufactured by Bengaluru-based BEML and is likely to be ready by 2027.

India’s first bullet train

At present, BEML and the Integral Coach Factory (ICF) are jointly working on the B28 bullet train project, designed for speeds of up to 280 kmph. The prototype is likely to be completed early next year and is scheduled to begin operations on a section of the Mumbai-Ahmedabad High Speed Rail Corridor by August 2027.“Our next domestically developed high-speed train will be capable of running at 350 kmph,” Vaishnaw told ET.Vaishnaw said the upcoming high-speed trains are being equipped with specialised features tailored to India’s varied climatic conditions.The minister also stated that the Railway Board will prioritise safety while integrating new technologies during the current financial year. According to him, close to 70,000 kilometres of railway tracks have been laid over the past decade, and more than 80% of the national rail network is now capable of supporting train speeds of up to 110 kmph.Earlier this week, an image of the proposed design of India’s first indigenous bullet train was displayed at Rail Bhawan. The Railway Board has said that the image is a design stage one, symbolic in nature and not the actual design of the train.The visual of the high-speed train, recently installed at Rail Bhawan, drew considerable attention from visitors, many of whom assumed it represented the first official glimpse of India’s inaugural bullet train project, slated for launch in August 2027.

The Pakistan Stock Exchange (PSX) witnessed a cautious yet positive start to Wednesday’s trading session, with the benchmark KSE-100 Index showing early signs of stability amid improving investor sentiment. The benchmark KSE-100 Index was trading at 163,611.87 with gains of 715.19 points or 0.44% at 1:44pm.

At around 9:39am, the index climbed to 162,940.75 points, gaining 44.07 points, or 0.03%, shortly after trading commenced. As the session progressed, the market maintained a steady upward trajectory, reflecting measured buying activity across key sectors. According to market data, the index touched an intraday high of 163,814.63 and a low of 162,895.74, trading at 163,611.87.

Investor interest remained visible in automobile assemblers, cement, commercial banks, oil and gas exploration companies, and power generation stocks, helping the market sustain momentum during early trading hours.

Read: PSX stages modest rally, gains 1,092 points

Market sentiment was further supported by developments in global oil markets. Oil prices slipped nearly 1% on Wednesday after United States President Donald Trump reiterated that the conflict involving Iran could conclude “very quickly.”

However, investors continued to monitor the outcome of ongoing peace negotiations closely, amid lingering concerns over disruptions to Middle Eastern oil supplies. Meanwhile, trading volume stood at 92.97 million shares, while the total traded value reached Rs8.03 billion with trading underway.