MSE News: Inflation dives as economy put on 'negative outlook'

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oldvicar wrote: »

This is not just seasonal, they didn't fall back like this in recent years.

Recent years are no guide, we've had VAT increases two years in a row.

To the extent that it's not seasonal, it's struggling retailers turning stock into cash to pay the rent.

AirlieBird

oldvicar wrote: »

However. whilst this is normally true - that despite a fall in the headline annual %age change in inflation rate prices have increased year on year and also since the previous month's announcement, on this occasion ABSOLUTE PRICES REALLY HAVE FALLEN. Look at the detailed figures in the link below, and the index level of CPI and RPI have both FALLEN in January, back to where they were in October or November 2011, depending on you preferred measure. This is not just seasonal, they didn't fall back like this in recent years.

It is seasonal. It is very unusual for the incidies not to fall back in January compared with December.

oldvicar wrote: »

although I cannot see where AirlieBird gets the suggestion of a 0.8 percentage point increase from at all.

ONS commentary:

In the year to January, the CPIY rose by 3.6 per cent, up from 2.8 per cent in December. The CPIY 12-month rate has therefore increased by 0.8 percentage points between December and January compared with a fall of 0.6 percentage points in the CPI 12-month rate between the same two months.

oldvicar

AirlieBird wrote: »

It is seasonal. It is very unusual for the incidies not to fall back in January compared with December.


ONS commentary:

In the year to January, the CPIY rose by 3.6 per cent, up from 2.8 per cent in December. The CPIY 12-month rate has therefore increased by 0.8 percentage points between December and January compared with a fall of 0.6 percentage points in the CPI 12-month rate between the same two months.

Thanks. I apologise for jumping to conclusions on a far too cursory glance at just the CPI and RPI index tables earlier.

This seems to show that the BoE has been worrying unneccessarily about the risk of inflation slowing down too much and fits nicely with my prejudice that inflation is booming / out of control.