UK Inflation Rate Down to 12-Year Low

British consumer prices rose 1 percent year-on-year in November, slowing from a 1.3 percent rise in the previous month. It is the lowest rate since September of 2002 due to a fall in motor fuel and food prices.

Year-on-year, the highest downward pressures came from motor fuel prices (-5.9 percent); food cost (-1.7 percent); miscellaneous goods and services (-0.8 percent); clothing and footwear (-0.2 percent) and transport (-0.2 percent). In contrast, education cost recorded the highest increase (10 percent), followed by alcoholic beverages and tobacco (4 percent) and housing, water, electricity and gas (3.3 percent).

On a monthly basis, consumer prices fell 0.3 percent in November, following a 0.1 percent increase in the previous month. Falls in transport costs (-1.2 percent), notably for motor fuels, air transport and second-hand cars and in the prices of recreational and cultural goods (-0.3 percent) were the main contributors to the slowdown in the rate of inflation between October and November. Food and motor fuel prices, which have historically been upward contributors to the monthly rate, are currently reducing it by 0.4 percentage points. 

Annual core inflation, which strips out cost of energy, food, alcohol and tobacco slowed to 1.2 percent in November from 1.5 percent in October.

UK Inflation Rate Down to 12-Year Low

ONS | Joana Taborda |
12/16/2014 9:54:14 AM