UK Consumer prices back at 3.0%.
This article is originally referred from Orbex Market Recap.
Consumer prices in the United Kingdom continued to rise back to the 3.0% threshold on an annual basis in January 2018.
However, overall inflation was seen to be stable in January with downward pressure from fuel and food prices which managed to offset an increase in prices from the recreational and cultural goods.
Consumer prices registered a 3.0% increase in January which was the same pace of increase in December last year, data from the UK’s Office of National Statistics showed on Tuesday.
This was slightly higher than the forecasts that showed consumer prices might have increased at only 2.9%.
Core consumer prices which excludes the volatile food and energy prices was seen accelerating from 2.5% in December to 2.7% in January.
This was higher than the estimates that pointed to a slower increase at 2.6%.
The inflation data comes after the BoE’s decision to keep interest rates steady at its meeting just the week before.
The central bank which gave its inflation forecasts had previously noted that consumer prices will remain close to 3% in the first quarter of the year.
However, it expects prices to slow in the coming quarters given the recent appreciation in the exchange rate of the British pound.
The Bank of England had however signaled that rates could rise faster than it had previously anticipated.
On a month over month basis, consumer prices were seen falling 0.5% which was slower than the expectations that pointed to a 0.6% drop.
The ONS data showed that output prices also grew at a slower pace in nearly a year.
The output price inflation was seen easing to 2.8% in January which was the weakest level registered since November 2016. A month before, output prices were at 3.3%.
Economists had forecast that output prices would moderate to 3 percent.
Original Source: Orbex Market Recap