UK Inflation Rate Below Forecasts

The annual inflation rate in the UK edged up to 2.2% in July 2024 from 2% in June, but below forecasts of 2.3%.

Prices rose faster for housing and household services (3.7% vs 2.3%), as prices of gas (-22.8% vs -37.5%) and electricity (-19.5% vs -21%) fell less than in the previous month.

Prices also rose more for clothing and footwear (2.1% vs 1.6%), communication (4.5% vs 2.9%) and miscellaneous goods and services (3.5% vs 2.9%).

On the other hand, inflation steadied for food and non-alcoholic beverages (1.5%) and education (4.5%).

In addition, inflation slowed for services (5.2%, the lowest since June 2022 and below BoE's forecast of 5.6%); restaurants and hotels (4.9% vs 6.2%), mostly hotels; recreation and culture (3.7% vs 3.9%); and transport (0.2% vs 0.9%), mainly maintenance and repairs (5.7% vs 8%), passenger transport by air (-10.4% vs -0.9%), and motor fuels.

Core inflation rate eased to 3.3% from 3.5%, below expectations of 3.4%.

Compared to June, the CPI edged 0.2% lower.