UK Inflation Rate Rises to 2.5% in July

Consumer price inflation in the UK rose to an annual rate of 2.5 percent in July 2018 from a year low of 2.4 percent in the previous month and in line with market expectations. Inflation picked up for the first time since last November.
ONS | Joana Ferreira | 8/15/2018 9:30:12 AM
Main upward pressure came from: transport (5.7 percent vs 5.5 percent); recreation and culture (3.1 percent vs 2.4 percent); housing, water, electricity, gas and other fuels (2.3 percent vs 2.1 percent); and food and non-alcoholic beverages (2.3 percent vs 2 percent).

Meanwhile, prices rose at a softer pace for restaurants and hotels (2.5 percent vs 2.6 percent), and furniture, household equipment and maintenance (1.3 percent vs 2 percent); while a deflation was recorded in both miscellaneous goods and services (-1 percent vs -0.2 percent) and clothing and footwear sub-indexes (-0.4 percent vs 0.3 percent).

The consumer prices index including owner occupiers’ housing costs (CPIH) rose by 2.3 percent in July, the same as in June.

The annual core inflation rate, which excludes prices of energy, food, alcohol and tobacco, stood at 1.9 percent in July, the lowest since March 2017.

On a monthly basis, consumer prices were unchanged for the second straight month, compared with market expectations of a 0.1 percent drop. An increase in prices of transport (1.3 percent), recreation and culture (0.5 percent), housing and utilities (0.4 percent), restaurants and hotels (0.2 percent) and food and non-alcoholic beverages (0.2 percent) was offset by declines in cost of clothing and footwear (-3.7 percent), furniture, household equipment and maintenance (-1.8 percent) and miscellaneous goods and services (-0.8 percent).

UK Inflation Rate Rises to 2.5% in July