UK Inflation Rises Unexpectedly to 6-Month High

Consumer price inflation in the UK rose to an annual rate of 2.7 percent in August 2018 from 2.5 percent in the previous month and comfortably above market expectations of 2.4 percent. It was the highest inflation rate since February mainly boosted by rising prices of transport, recreation & culture, and food & non-alcoholic beverages.
ONS | Joana Ferreira | 9/19/2018 8:50:40 AM
Main upward pressure came from: transport (6.1 percent vs 5.7 percent); recreation and culture (3.6 percent vs 3.1 percent); and food and non-alcoholic beverages (2.5 percent vs 2.3 percent); clothing and footwear (0.3 percent vs -0.4 percent). Also, inflation was unchanged for both housing, water, electricity, gas and other fuels (at 2.3 percent); and restaurants and hotels (at 2.5 percent).

Meanwhile, prices of furniture, household equipment and maintenance rose at a softer pace (0.7 percent vs 1.3 percent); while a deflation was recorded in miscellaneous goods and services (-0.7 percent vs -1 percent).

The consumer prices index including owner occupiers’ housing costs (CPIH) rose by 2.4 percent in August, up from 2.3 percent in the previous month.

The annual core inflation rate, which excludes prices of energy, food, alcohol and tobacco, increased to a four-month high of 2.1 percent in August, from 1.9 percent in July.

On a monthly basis, consumer prices climbed 0.7 percent in August after being unchanged in the previous month, also beating market expectations of a 0.5 percent gain. There were increases in prices of clothing and footwear (3.1 percent), transport (1.3 percent), furniture, household equipment and maintenance (1.2 percent), recreation and culture (0.6 percent), miscellaneous goods and services (0.6 percent), food and non-alcoholic beverages (0.2 percent), housing and utilities (0.1 percent), and restaurants and hotels (0.1 percent).

UK Inflation Rises Unexpectedly to 6-Month High