Inflation has remained stubbornly high, with the annual rate falling just slightly last month to 4.9 per cent, still more than twice the EU average.
While the annual rate did ease from 5.1 per cent the previous month, analysts had expected a larger decline and fear the rate will average well in excess of 4 per cent for the year.
The monthly increase in March was 0.8 per cent, down from 1 per cent the previous month; February prices had been pushed up by the end of the sales. Excluding February, last month was the highest monthly increase since early 2002, at a time when the strong euro and slowing economy might have been expected to ease price pressures.
A range of prices increased, including electricity and home-heating oil, pushed up by the rise in crude oil prices in the run up to the Iraq war. Other significant rises were in clothing and footwear, restaurants, hotels, transport and a range of foodstuffs.
The Irish rate remains more than twice the EU average of 2.3 per cent. The average in the 12-state euro zone is 2.4 per cent.
A more significant drop in the annual rate had been expected by most analysts, as the VAT increase in March 2002 was no longer boosting the year-on-year comparison.
AIB Group Treasury said it was "a disappointing set of figures with price rises across a broad range of products." It now predicts an average rate of 4.3 per cent for 2003.
IIB Bank is making the same forecast and said the March figure "suggests that underlying inflation pressures remain embedded at present".
Fine Gael, Labour and the Green Party all accused the Government of pushing up inflation through tax increases and higher public-sector charges, and of having no strategy to reduce price pressures.
Business lobby groups also expressed concern. IBEC said that public policy must focus on supporting the downward trend as business is "bearing the brunt" of various increases. It will press its case for action at the first meeting next week of the anti-inflation group set up under the new national programme.
ISME, the small business group, said the Government needs to address the cost of public services.
