UK Inflation Rate Remains at 5-Year High

Consumer prices in the UK increased 3 percent yoy in October, the same as in September and below expectations of 3.1 percent. Still, it was the highest inflation rate since March 2012, with prices of food, housing, utilities and recreational goods making the biggest upward contribution.

Year-on-year, prices rose faster for housing and utilities (2.3 percent compared to 2.1 percent in September); recreation and culture (2.8 percent compared to 2.5 percent); food and non-alcoholic beverages (4 percent compared to 3 percent, the highest in four years) and health (3.4 percent compared to 2.4 percent). On the other hand, the inflation was steady for restaurants and hotels (3.1 percent); alcoholic beverages and tobacco (4.3 percent) and a slowdown was seen for transport (4 percent compared to 4.2 percent); miscellaneous goods and services (0.9 percent compared to 1.4 percent); clothing and footwear (3.2 percent compared to 3.3 percent); furniture, household equipment and maintenance (3.1 percent compared to 4 percent); communication (1.7 percent compared to 2 percent) and education (2.8 percent compared to 2.9 percent). 

On a monthly basis, consumer prices edged up 0.1 percent, below 0.3 percent in September and forecasts of 0.2 percent. Rising prices for food and, to a lesser extent, recreational goods provided the largest upward contributions, which were offset by falling motor fuel and furniture prices, along with owner occupiers’ housing costs, which remained unchanged. 

The annual core inflation rate, which excludes prices of energy, food, alcohol and tobacco, stood at 2.7 percent in October, unchanged from the previous month's five-year high and below market consensus of 2.8 percent.

UK Inflation Rate Remains at 5-Year High

ONS | Joana Taborda |
11/14/2017 10:37:30 AM