UK June Inflation Rate Weaker than Expected

Consumer price inflation in the UK stood at an annual rate of 2.4 percent in June 2018, unchanged from the previous month and below market expectations of 2.6 percent. June's rate remained at the lowest level since March 2017.
ONS | Joana Ferreira | 7/18/2018 8:54:12 AM
Transport prices jumped 5.5 percent in June, after a 4.7 percent advance in the previous month; and cost of housing, water, electricity, gas and other fuels moved up 2.1 percent, following a 1.5 percent gain in May.

Meanwhile, prices rose at a softer pace for recreation and culture (2.4 percent vs 2.6 percent); food and non-alcoholic beverages (2 percent vs 2.3 percent); clothing and footwear (0.3 percent vs 1.5 percent); and furniture, household equipment and maintenance (2 percent vs 2.1 percent). Restaurants and hotels inflation was unchanged at 2.6 percent; while a deflation was recorded in the miscellaneous goods and services sub-index (-0.2 percent vs unchanged).

The consumer prices index including owner occupiers’ housing costs (CPIH) rose by 2.3 percent in June, the same as in May.

The annual core inflation rate, which excludes prices of energy, food, alcohol and tobacco, fell to 1.9 percent June from 2.1 percent in the previous month, and missing market expectations of 2.2 percent. It was the lowest rate since March 2017.

On a monthly basis, consumer prices were unchanged, compared with May's 0.4 percent gain and market expectations of a 0.2 percent advance. An increase in prices of transport (0.8 percent), housing and utilities (0.6 percent) and restaurants and hotels (0.3 percent) was offset by declines in cost of recreation and culture (-0.4 percent), food and non-alcoholic beverages (-0.5 percent), miscellaneous goods and services (-0.1 percent) and clothing and footwear (-2.1 percent).

UK June Inflation Rate Weaker than Expected