Good morning colleagues,

In his analysis of recent developments, John McManus reminds us today that inflation "is here now and has started to show up in official figures." It was 3.6% in March, its highest in two years, driven by 12.3% surge in energy prices. 

He goes on to say that the €505 million the Government committed to reducing fuel prices last week "is at best dead money...At worst it could add to inflation pressures by feeding demand and the expectation of further concessions including public-sector pay increases...Trade unions will have noted the concessions obtained by fuel protesters and contrasted it with how legal industrial action by their members is received. Pay demands are clearly on the way. The spiral has begun." 

A taste, perhaps, of the commentary we can expect in the months ahead.