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UK CPI inflation steady at 3.1 pct as expected in Sept

09:30 12Oct10 - UK CPI inflation steady at 3.1 pct as expected in Sept

LONDON, Oct 12 - British consumer price inflation held steady at 3.1 percent as expected in September as a drop in transport costs offset a record jump in clothing prices and higher food inflation, official data showed on Tuesday.

The Office for National Statistics said consumer prices were flat on the month, leaving the annual rate of inflation at 3.1 percent, the same as in August and in line with economists' forecasts.

That is still well above the Bank of England's 2 percent target, although policymakers expect price pressures to ease over the next year, and therefore the figures are unlikely to change the view that monetary policy will remain extremely loose for some time to come.
Concerns about Britain's economic recovery have raised the possibility the central bank may have to pump more money into the economy to shore up growth.

The ONS said there were significant upward and downward pressures on inflation in September.

Airfares fell 27.8 percent in September, while clothing and footwear prices posted a record rise.

The retail price inflation gauge eased less than expected to 4.6 percent in September from 4.7 percent, versus forecasts for a reading of 4.4 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.
Excluding volatile food and fuel components, CPI inflation eased slightly to 2.7 percent.

Trade data published at the same time showed Britain's goods trade gap with the rest of the world narrowed to 8.227 billion pounds in August, broadly in line with expectations.
Please take the time to have a look around my Daughter's website www.daisypalmertrust.co.uk
(MSE Andrea says ok!)
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Comments

  • Graham_Devon
    Graham_Devon Posts: 58,560 Forumite
    Part of the Furniture 10,000 Posts Combo Breaker
    Was supposed to be below 2% now wasn't it?
  • 09:32 12Oct10 - STERLING HITS DAY'S LOW VS DOLLAR OF $1.5832 AFTER UK CPI, TRADE DATA


    LONDON, Oct 12 - Sterling fell to the day's low against the dollar on Tuesday after data showed UK inflation rose in line with expectations while the UK trade balance narrowed a little less than expected.

    British consumer price inflation held steady at 3.1 percent asexpected in September as a drop in transport costs offset a record jump in clothing prices and higher food inflation, official data showed on Tuesday.

    Sterling fell around 30 pips against the dollar to the day's low of $1.5832 <GBP=D4> before recovering to $1.5850.

    Britain's FTSE 100 <.FTSE> slightly extended losses after the inflation data, down 1.2 percent at 5,603.44 by 0833 GMT.

    Analysts said a higher-than-expected CPI figure would have dampened expectations that the Bank of England would opt for more quantitative easing.
    Please take the time to have a look around my Daughter's website www.daisypalmertrust.co.uk
    (MSE Andrea says ok!)
  • 09:55 12Oct10 - Miles more QE dovish from BoE's Miles, CPI breakdown helps?

    08:54 GMT - [MILES MORE DOVISH] After initially leading the market down the
    garden path with on-the-fence QE observations/risks, BoE's Miles true
    colours have come to the fore, perhaps. He now says the BoE may yet come
    to use QE, claiming it remains a potentially powerful tool. He sees it
    healthy that the MPC disagree on rate policy and reiterates that growth &
    infl expectations are very uncertain. Perhaps, Miles wanted to see the UK
    inflation data before these latest (more telling) QE positive remarks.
    Also in the [CPI], there are reasons not to be dismayed by the outcome.
    For a starter, as we have mentioned before, base effects will turn CPI in
    months to come lower, by 1.1% over the next 3 months. Also, looking at
    the breakdown, clothing & footwear surged by 6.4% m/m vs 2.8% last (and
    0.9% y/y from -1.7%) with the ONS pointing out this was the biggest
    monthly rise & y/y record - ie looks suspect for a reversal next month.
    Please take the time to have a look around my Daughter's website www.daisypalmertrust.co.uk
    (MSE Andrea says ok!)
  • lemonjelly
    lemonjelly Posts: 8,014 Forumite
    1,000 Posts Combo Breaker Mortgage-free Glee!
    Are retailers concerned about christmas spending this year? Retail spending doesn't appear to be too badly affected at the moment.

    With VAT going up, & the pressures on food prices & the recent increase in fuel duty, I feel inflation is going to be above 3% for a while yet.
    It's getting harder & harder to keep the government in the manner to which they have become accustomed.
  • DervProf
    DervProf Posts: 4,035 Forumite
    Merv told me it was "just a blip".
    30 Year Challenge : To be 30 years older. Equity : Don't know, don't care much. Savings : That's asking for ridicule.
  • Heyman_2
    Heyman_2 Posts: 1,819 Forumite
    Quick, better put interest rates up! That'll solve everything innit?
  • Great news for those of us who are overleveraged debt junkies! :D

    Let the low BoE rates and high mortgage overpayments continue!
  • Graham_Devon
    Graham_Devon Posts: 58,560 Forumite
    Part of the Furniture 10,000 Posts Combo Breaker
    Great news for those of us who are overleveraged debt junkies! :D

    Hmph, not quite so good for us parasites. Though there does seem to be a hint of a small battleground on the savings front. :D
  • Hmph, not quite so good for us parasites. Though there does seem to be a hint of a small battleground on the savings front. :D

    I read on here that you have a mortgage Graham. If your mortgage is larger than your savings, then your also quids in. :)
  • Graham_Devon
    Graham_Devon Posts: 58,560 Forumite
    Part of the Furniture 10,000 Posts Combo Breaker
    I read on here that you have a mortgage Graham. If your mortgage is larger than your savings, then your also quids in. :)

    I do, however, have more savings. :)
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