Surging costs at the factory gate set to add pressure on inflation

Input prices also rose, hitting an annual rate of 14.6 per cent, suggesting that pipeline inflation pressures are continuing to build.

While the figures were broadly in line with what economists had been expecting, they are certain to worry the Bank of England at a time when consumer price inflation is already double its 2 per cent target. On Thursday, the bank's monetary policy committee (MPC) voted to hold interest rates at their historic low of 0.5 per cent though most commentators are pencilling in a rise by May.

A 33.5 per cent annual jump in oil input prices was the chief contributor to the rise in manufacturers' cost base. Food, imported metals and chemicals also exerted strong upward pressure.

On the month, crude oil contributed more than three-quarters of the total rise in firms' input prices.

Bank of England governor Mervyn King has admitted that surging oil prices could push inflation further above target, as higher fuel costs feed through to the high street. However, he has also noted that higher energy costs will weigh on global growth which could have a downward impact on inflation over the longer term.

Howard Archer, chief economist at IHS Global Insight, the forecasting group, said a further jump in producer input prices was "worrying news".

"Companies are under major pressure from sharply rising input costs to defend their margins by raising their output prices. And extended, ongoing, decent manufacturing activity is giving some companies greater scope to push through price hikes," he said.

Archer noted that core producer output prices, which exclude volatile factors such as oil and food, had eased on the year to 3.1 per cent from 3.2 per cent in January. He said the news would provide "one crumb of comfort" for central bank policymakers.

The British Chambers of Commerce said higher producer prices "complicates the MPC's job", while the increases in costs of raw materials and fuels intensified pressures on businesses.

David Kern, its chief economist, said: "There have been strong increases in the cost of materials and fuels purchased by businesses and this will intensify pressures on cashflows and on profit margins.

"While we are hopeful that UK businesses will prove sufficiently robust to deal with this situation, the immediate risks cannot be shrugged off."

He conceded that interest rates were likely to rise in May.