Inflation in United Kingdom
United Kingdom - Inflation
Inflation moves into double figures in July
Consumer prices rose 0.61% in July over the previous month, slowing down from the 0.80% increase recorded in June. Looking at the details of the release, prices for recreation and culture rose at a faster pace in July. However, prices for transportation increased at a more moderate rate. Meanwhile, housing and utilities prices grew at a quicker pace.
Despite the month-on-month moderation, annual inflation rose to 10.1% in July, following June’s 9.4%. July's figure represented the highest inflation rate since the early 1980s, and was above market expectations. Annual average inflation rose to 6.5% in July (June: 5.8%). Finally, core inflation rose to 6.2% in July, from June’s 5.8%.
July’s inflation reading is likely to spur the Central Bank into another aggressive rate hike at its September meeting. Inflation is expected to rise further from its current level by year-end, due to a tight labor market and the re-rating of Ofgem’s energy price cap from October—recent reports suggest the cap could rise by as much as 75% from its current level.
FocusEconomics Consensus Forecast panelists expect inflation to average 8.5% in 2022, up 0.3 percentage points from last month’s forecast, and 5.0% in 2023.
United Kingdom - Inflation Data
|Inflation Rate (CPI, annual variation in %)||0.0||0.7||2.7||2.5||1.8|
5 years of economic forecasts for more than 30 economic indicators.
United Kingdom Inflation Chart
Source: Office for National Statistics (ONS).
United Kingdom Facts
|Bond Yield||0.83||-3.04 %||Jan 01|
|Exchange Rate||1.33||-0.35 %||Jan 01|
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August 23, 2022
The S&P Global/CIPS Flash Composite Purchasing Managers’ Index (PMI) came in at 50.9 in August, down from July's 52.1.
August 23, 2022
Liz Truss is the favorite to become Prime Minister in September, and promises tax cuts. The cost-of-living crisis is likely to force the next PM into greater fiscal handouts to vulnerable households. Relations with the EU will likely stay tense. What’s happening: The result of the Conservative Party leadership election between former Chancellor Rishi Sunak and Foreign Secretary Liz Truss will be announced on 5 September.
August 19, 2022
Consumer confidence came in at minus 44.0 in August, down from July's minus 41.0.
August 17, 2022
Consumer prices rose 0.61% in July over the previous month, slowing down from the 0.80% increase recorded in June.
August 12, 2022
GDP contracted 0.1% on a seasonally-adjusted quarter-on-quarter basis in the second quarter, contrasting the 0.8% expansion recorded in the first quarter and broadly in line with our analysts’ expectations.