–Corrects Month in First Paragraph, Updates
–Mar Producer Output Prices +0.6% m/m; +3.6% y/y
–Mar Core Producer Output Prices +0.1% m/m; +2.5% y/y
–Mar Input Prices +1.9% m/m; +5.8% y/y
LONDON (MNI) – Output price inflation fell to its lowest level for
more than two years in March, but a rise in oil prices caused a spike in
input costs, figures from National Statistics showed Friday.
The slowdown in inflation was mainly due to base effects from rises
in tobacco and alcohol prices, due to tax increases, and petrol prices,
in March last year which were not repeated this year
Output prices rose 0.6% on the month and were up 3.6% on the year,
a little higher than the median for a rise of 0.5% on the month and 3.5%
on the year. This was the lowest level of inflation since January 2010.
Core output prices rose 0.1% on the month and were up 2.5% on the
year, down from 2.5% in February. This was below the median for a rise
of 0.2% on the month and 2.7% on the year.
A possible pick-up in producer price inflation has been highlighted
by some Monetary Policy Committee members recently as a possible reason
why consumer price inflation could turn out higher than the Bank of
England’s latest forecast. These data show a mixed picture with input
prices rising sharply on the month.
Input prices rose 1.9% on the month, as the price of crude oil
increased 6.3% on the month. There was also upward pressure from other
imported material prices.
MPC member Martin Weale cautioned last month about rising prices.
“Import prices have been rising more than one might have expected and
…. if that sort of process goes on and no offsetting adjustment takes
place, then it could turn into one reason why inflation might be higher
than we think,” he said in a speech at CASS Business School.
–London bureau: 0044 20 7862 7491; email: puglow@marketnews.com
[TOPICS: M$B$$$,MABDS$]
