Latest data released by ONS - 23 May 2018
- Prior +0.1%
- CPI +2.4% vs +2.5% y/y expected
- Prior +2.5%
- Core CPI +2.1% vs +2.2% y/y expected
- Prior +2.3%
That's a much weaker core and headline figure than expected. Sterling marked lower with cable falling to a session low of 1.3350 currently. While the fact that falling inflation is a welcome sign for the UK consumer, it's not a great sign for those arguing for a rate hike by the BOE. And the latter's direct effect is more seen rather than the invisible pass through effect of inflation on household income.
Looking at the report, air fares was one on the major downside contributor - falling to a 13-month low - with possible effects from Easter once again the likely cause. Auto fuel (affected by oil prices) was one of the bigger contributors to the upside, and that owes to rising crude oil prices over the last few months.
Some other details on the day as producer price and retail price figures are released:
- PPI output +0.3% vs +0.2% m/m expected
- PPI output +2.7% vs +2.3% y/y expected
- PPI input +0.4% vs +1.0% m/m expected
- PPI input +5.3% vs +5.8% y/y expected
- RPI +0.5% vs +0.5% m/m expected
- RPI +3.4% vs +3.4% y/y expected
- March HPI +4.2% vs +4.4% expected
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