Factory gate prices of goods produced by the UK manufacturers increased 1.6% year-on-year in June of 2019, easing from an upwardly revised 1.9% rise in the prior month and slightly below market expectations of 1.7%. It is the lowest producer inflation since September of 2016, as cost slowed for wood & products of wood and cork (3.1% from 3.2% in May); paper & paper products (0.9% from 2.1%); chemicals (0.5% from 0.8%); basic metals (0.2% from 1.4%); computer, electronic & optical products (2.9% from 3%) and machinery & equipment (1.3% from 1.5%). Also, prices fell for coke & refined petroleum products (-2.4% from 0.9%), mainly diesel and gas oil (-3.6%); leather & related products (-3.5% from 0.3%) and basic pharmaceutical products (-0.2% from 2.8%). Prices for materials and fuels paid by the UK manufacturers for processing (input prices) went down 0.3 percent in June, the first fall since June 2016 driven by a large downward contribution from crude oil. Producer Prices Change in the United Kingdom averaged 5.04 percent from 1964 until 2019, reaching an all time high of 27.80 percent in January of 1975 and a record low of -1.90 percent in August of 2015.
Producer Prices Change in the United Kingdom is expected to be 1.80 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Producer Prices Change in the United Kingdom to stand at 2.00 in 12 months time. In the long-term, the United Kingdom Producer Prices Change is projected to trend around 2.50 percent in 2020, according to our econometric models.