UK August Inflation Rate at Over 2-1/2-Year Low

The annual inflation rate in the United Kingdom fell to 1.7 percent in August 2019 from 2.1 percent in the previous month and below market expectations of 1.9 percent. It was the lowest inflation rate since December 2016, amid a slowdown in cost of transport and a fall in clothing & footwear prices.

Year-on-year, prices eased for transport (1.4 percent from 1.5 percent in July); furniture, household equipment and maintenance (0.8 percent from 1.1 percent); recreation and culture (1.2 percent from 2.4 percent); restaurants and hotels (2.8 percent from 3.1 percent); health (2.4 percent from 2.6 percent); communication (3.6 percent from 3.8 percent); and alcoholic beverage and tobacco (3.3 percent from 3.8 percent). Also, cost of clothing and footwear dropped 0.9 percent, after increasing 0.4 percent in July. On the other hand, prices rose further for food and non-alcoholic beverages (1.8 percent from 1.4 percent); and miscellaneous goods and services (1.8 percent from 1.7 percent). In addition, inflation was steady for housing, water, electricity, gas and other fuels (at 2.4 percent); and education (at 3.1 percent).

The consumer prices index including owner occupiers’ housing costs (CPIH) declined to 1.7 percent in August from 2 percent in the prior month.

The annual core inflation rate, which excludes prices of energy, food, alcohol and tobacco, decreased to 1.5 percent, its lowest since November 2016, from 1.9 percent in July.

On a monthly basis, consumer prices advanced to 0.4 percent, following a flat reading in the previous month.

UK August Inflation Rate at Over 2-1/2-Year Low

ONS | Stefanie Moya |
9/18/2019 8:51:25 AM