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UK June CPI slows as expected after petrol price fall
inspector_monkfish
Posts: 9,276 Forumite
09:30 13Jul10 - UK June CPI slows as expected after petrol price fall
LONDON, July 13
British inflation eased for a second month running in June, helped by lower petrol prices and summer clothes sales, but remained above the Bank of England's target for a seventh consecutive month, official data showed on Tuesday.
The Office for National Statistics said annual consumer price inflation eased to 3.2 percent from May's 3.4 percent after prices rose just 0.1 percent on the month -- in line with economists' expectations.
Consumer price inflation hit a 17-month high of 3.7 percent in April, prompting concern among some BoE policymakers, notably Andrew Sentance, that slack in the economy was failing to bear down on inflation to the degree expected.
Still, the Bank of England's central view is that inflation will ease back towards its 2 percent target over the course of the year once past rises in oil prices and January's VAT rise fall out of the annual comparison.
Falling transport costs, notably a reduction in petrol prices, knocked 0.17 percentage points off the annual rate of CPI. The biggest fall in clothing prices in June since records began also helped reduce annual CPI by 0.05 percentage points.
However, insurance premiums and airfares rose and core CPI inflation rose to 3.1 percent from 2.9 percent, its joint-highest rate since records began in 1997.
The retail price inflation gauge fell to 5.0 percent from 5.1 percent, versus forecasts for an easing to 4.9 percent.
RPI includes more housing costs than CPI, which matches the European Union Harmonised Index of Consumer Prices (HICP), and is used to index many social security payments and some wages.
LONDON, July 13
British inflation eased for a second month running in June, helped by lower petrol prices and summer clothes sales, but remained above the Bank of England's target for a seventh consecutive month, official data showed on Tuesday.
The Office for National Statistics said annual consumer price inflation eased to 3.2 percent from May's 3.4 percent after prices rose just 0.1 percent on the month -- in line with economists' expectations.
Consumer price inflation hit a 17-month high of 3.7 percent in April, prompting concern among some BoE policymakers, notably Andrew Sentance, that slack in the economy was failing to bear down on inflation to the degree expected.
Still, the Bank of England's central view is that inflation will ease back towards its 2 percent target over the course of the year once past rises in oil prices and January's VAT rise fall out of the annual comparison.
Falling transport costs, notably a reduction in petrol prices, knocked 0.17 percentage points off the annual rate of CPI. The biggest fall in clothing prices in June since records began also helped reduce annual CPI by 0.05 percentage points.
However, insurance premiums and airfares rose and core CPI inflation rose to 3.1 percent from 2.9 percent, its joint-highest rate since records began in 1997.
The retail price inflation gauge fell to 5.0 percent from 5.1 percent, versus forecasts for an easing to 4.9 percent.
RPI includes more housing costs than CPI, which matches the European Union Harmonised Index of Consumer Prices (HICP), and is used to index many social security payments and some wages.
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Comments
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CPI: 3.2%, 3.4% previous.
CPI continues to fall as predicted, no chance of rate rises any time soon then.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
So without the VAT rise, CPI would be pretty much bang on target. I can't see the UK putting up interest rates any time soon.
Bank reserves fell by 0.8% last month (link) as are wages (according to the Daily M**l - link) so consumer demand looks unlikey to push up inflation.
GDP doesn't seem to be roaring ahead either so supply constraints seem unlikely to cause inflation.
With unemployment at 2,500,000 or thereabouts, labour supply seems unlikely to be tight at any point in the forseeable.
I agree with Hamish McT - interest rates are going nowhere for now.0 -
Which points to deflation and stuff like houses get cheaper per chance:cool:
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Come on LJ. Who' the daddy.:D0
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So without the VAT rise, CPI would be pretty much bang on target. I can't see the UK putting up interest rates any time soon.
Bank reserves fell by 0.8% last month (link) as are wages (according to the Daily M**l - link) so consumer demand looks unlikey to push up inflation.
GDP doesn't seem to be roaring ahead either so supply constraints seem unlikely to cause inflation.
With unemployment at 2,500,000 or thereabouts, labour supply seems unlikely to be tight at any point in the forseeable.
I agree with Hamish McT - interest rates are going nowhere for now.
Does that mean I should get a tracker mortgage now?
Well?0 -
Then again the June retail numbers came in 'robust'So without the VAT rise, CPI would be pretty much bang on target. I can't see the UK putting up interest rates any time soon.
Bank reserves fell by 0.8% last month (link) as are wages (according to the Daily M**l - link) so consumer demand looks unlikey to push up inflation.
GDP doesn't seem to be roaring ahead either so supply constraints seem unlikely to cause inflation.
With unemployment at 2,500,000 or thereabouts, labour supply seems unlikely to be tight at any point in the forseeable.
I agree with Hamish McT - interest rates are going nowhere for now.I think....0 -
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lemonjelly wrote: »Saw this early, & wondered how long it'd take you.
It's OK you can PM me on how right I was.
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It's OK you can PM me on how right I was.
Now now....
You're moving goal posts again....
We argued (back then) that the price of petrol was increasing.
You siad it was falling. I said it wasn't.
At the pumps, the prices were rising at the time of the debate.
In probably overly basic terms, raw materials costs were (may have been) falling, which led you to believe the future price of petrol would come down.
However, we agreed at the time (I clearly recall this!!!!) that I was right that petrol costs were rising.
Fast forward a very long time, & lo & behold petrol prices fall. Really2 remembers a debate from a very long time ago, & decides that now the facts suit his arguement he'll re-raise it, & argue he has won...
As I said, we agreed at the time I was right. I clearly recall this. Don't make me type it in capitals like a shouty person would.
Is it wrong I'm giggling as I type all this?:DIt's getting harder & harder to keep the government in the manner to which they have become accustomed.0 -
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