–UK Petrol Prices Up 0.1% On Month In Aug
–Petrol To Knock 0.04pp Off UK Aug y/y CPI Change

LONDON (MNI) – Petrol prices edged higher in August but base
effects entail they will have a small negative impact on the change in
the annual rate of CPI.

The MNI Index shows petrol prices rose just 0.1% on the month in
August, having risen by 1.0% last August. That base effect entails
petrol prices will take 0.04 percentage point off the change to the CPI
12-month rate.

In July, petrol prices were down 0.7% on the month and this too had
a negative impact on the change in the 12-month rate, with prices
having risen 0.7% a year ago.

The latest, most marked, upside pressure on UK inflation is coming
from the rise in food prices on the back of crop failures around the
world. Petrol prices at present are providing a smaller down effect.

The MNI Index has been reworked to better reflect the official
data.

National Statistics uses a monthly average for CPI fuel prices,
unlike other categories, such as food, where it uses a single day
collection point.

The Market News Index is now based on average monthly data supplied
by Experian, with weights for various petrol categories, such as
unleaded and super unleaded, obtained from the Department of Energy and
Climate Change’s Digest of UK Energy Stats (DUKES).

The Experian data is derived from fuel prices obtained daily from
every petrol station in the UK that accepts fuel cards.

The correlation between the MNI index and the moves in the fuels
and lubricants category in the official CPI data, which incorprates
petrol, has been strong in recent months.

To impact on CPI attaches the same weight to the MNI Petrol Index
as to fuels and lubricants.

Below are the results of the MNI petrol price index:

% change m/m 2010

! Aug ! Jul ! Jun ! May ! Apr ! March !
————————————————————————
MNI PETROL PRICE INDEX 0.1 -0.7 -1.9 0.7 4.3 2.7
ONS FUELS/LUBRICANTS n/a -0.7 -1.9 0.3 4.5 2.7
MNI Index Contibution
to CPI y/y Change -0.04 -0.06 -0.24 -0.07 0.01 0.08
ONS F/L Contribution
to CPI y/y Change n/a -0.06 -0.24 -0.09 0.02 0.08

—London Bureau; Tel: +44207 862 7492; email: drobinson@marketnews.com

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