The latest consumer price index reported for the UK saw the measure climb to 0.30% on an annualized basis, matching levels last seen in January. The value printed in line with expectations and exceeded December’s 0.20% rise. The increased was attributed to a sustained rise in housing and utilities costs whereas declines were reported in food, recreation and culture. However, the disappointments came from the monthly value which contracted by -0.80% during January, well below the previous month’s 0.10% reading and missing estimates of -0.70%, led by a vast -35.80% nosedive in airfare prices. Core annual inflation, which strips out the volatile food and energy components, slowed to 1.20% in January from December’s 1.40%. The Bank of England opted unanimously at the beginning of February to hold monetary policy untouched with rates at 0.50% as the inflation target of 2.00% remains far from reach.
UK Inflation Rises, But Not Enough for BoE
Daily Analysis - 17/02/2016