UK Inflation Unexpectedly Holds at 1-Year Low

Consumer price inflation in the UK stood at an annual rate of 2.4 percent in May 2018, unchanged from the previous month's one-year low and slightly below market expectations of 2.5 percent. Also, core inflation was flat at 2.1 percent.

Transport prices jumped 4.7 percent in May, after a 2.4 percent gain in the previous month; while prices rose at a softer pace for: recreation and culture (2.6 percent vs 3.5 percent in April); housing, water, electricity, gas and other fuels (1.5 percent vs 2.1 percent); restaurants and hotels (2.6 percent vs 2.7 percent); food and non-alcoholic beverages (2.3 percent vs 2.7 percent); clothing and footwear (1.5 percent vs 1.7 percent); and furniture, household equipment and maintenance (2.1 percent vs 2.7 percent).

The consumer prices index including owner occupiers’ housing costs (CPIH) rose by 2.3 percent in May, up from 2.2 percent increase in April.

The annual core inflation rate, which excludes prices of energy, food, alcohol and tobacco, was flat at 2.1 percent in May, remaining at the lowest level since March 2017.

On a monthly basis, consumer prices went up 0.4 percent in May, the same pace as in April and in line with market consensus. Upward pressure came from: transport (1.5 percent); recreation and culture (0.1 percent); housing and utilities (0.1 percent); and restaurants and hotels (0.4 percent).

UK Inflation Unexpectedly Holds at 1-Year Low

ONS | Joana Ferreira |
6/13/2018 8:52:04 AM