UK January Inflation Rate Stronger than Expected

The rate of inflation across the UK stood at 3 percent in January 2018, unchanged from the previous month and above market expectations of 2.9 percent. Prices of recreation and culture rose further while cost of food and transportation increased at a softer pace.

Year-on-year, upward pressure came from: recreation and culture (3.3 percent vs 2.7 percent in December); clothing and footwear (3.4 percent vs 3.1 percent); restaurants and hotels (unchanged at 3.1 percent); transport (3.4 percent vs 3.8 percent); housing, water, electricity, gas and other fuels (2.2 percent vs 2.3 percent); food and non-alcoholic beverages (3.7 percent vs 3.9 percent); and miscellaneous goods and services (unchanged at 0.8 percent).

The consumer prices index including owner occupiers’ housing costs (CPIH) rose by 2.7 percent in January, the same pace as in December.

The annual core inflation rate, which excludes prices of energy, food, alcohol and tobacco, rose to 2.7 percent in January from 2.5 percent in December, also beating market consensus of 2.6 percent. January's reading matched August's six-year high.

On a monthly basis, consumer prices fell 0.5 percent after increasing 0.4 percent in December, and compared with expectations of a 0.6 percent drop. Prices fell sharply for clothing and footwear (-3.9 percent), furniture, household equipment and maintenance (-2.6 percent) and transport (-1 percent).

UK January Inflation Rate Stronger than Expected

ONS | Joana Ferreira |
2/13/2018 9:53:25 AM