Annual inflation in the United Kingdom landed at 2.6% in March, dropping from February's inflation rate of 2.8% and coming below analysts' expectations, the UK Office for National Statistics revealed in a report on Wednesday.

The largest contributors to the annual inflation rate were clothing and footwear, with a 2.3% jump, and the restaurants and hotels division, with a 0.7% increase. The largest downward contributions to the monthly change came from recreation and culture, and motor fuels, "with a further large downward effect in CPIH from housing and household services." Further, education and food and non-alcoholic beverages divisions remained unchanged.

Consumer prices jumped by 0.3% on a monthly basis, while the Consumer Prices Index, including owner-occupiers' housing costs (CPIH), climbed by 3.4% year-on-year and rose by 0.3% month-on-month.