Business inflation has jumped 2.7%, eating into margins and forcing businesses to raise prices.
The first-quarter rise is the largest since the inflation measurement was introduced five years ago by More Than Business and Warwick Business School.
Similarly to the consumer index, the business inflation rate is measured by monitoring the price of a basket of 20 goods used heavily by a range of businesses, such as fuel, computer equipment or office stationery.
The annual rate now stands at 6.5%, more than double the increase in consumer prices.
Manufacturing has sustained the steepest rise, a quarterly increase of 2.9% and an annual rate now running at 7.6%. The biggest rises for specific items were in vehicle and maintenance costs and tax, up 7.53%, while fuel costs rose 6.3% and office equipment and furniture rose 5.8%.
Northern and southern England endured the worst cost rises regionally, both suffering a 2.8% increase compared with a low of 2.4% in Scotland.
Last year the overall rate of increase was only 0.5% and 0.9% in the final two quarterly periods, but the latest results will ignite fears of a surge in liquidations, particularly with a VAT hike imminent and consumers likely to follow the state in tightening their belts.
