–Petrol To Add 0.08pp To UK March y/y CPI
–UK Petrol Prices Up 3.7% On Month In March

LONDON (MNI) – Petrol prices surged in March and April, and will
add a shade less than 0.1 percentage point to the yearly change in the
March consumer price index, according to the Market News International
petrol price index.

The MNI index shows petrol prices rose 3.7% on the month in March,
and the same amount in April, with the March rise the largest since
June last year.

The 3.7% increase will add 0.08 percentage points to March CPI. A
rise in petrol prices in March last year, of 0.8% on the month, will
partially cushion the impact of the rise in petrol prices.

While petrol prices have put upward pressure on March CPI, shop
prices have moved in the opposite direction.

The British Retail Consortium shop price index for March fell to
its lowest level since November, standing up 1.2% on the year in March,
down from 1.7% in February and 2.3% in January.

The data reinforce the belief UK inflation may have peaked in
January, when the official consumer price index was up 3.5% on the year,
before falling to 3.0% in February.

The Bank of England predicted in its February Inflation Report
that March CPI would come in at 3.3%, which, unless there is an
unexpectedly large move up in CPI in March, looks likely to be an
overestimate.

Increases in oil and a raft of other commodity prices, coupled with
sterling weakness, are likely to limit inflation declines.

In February, transport costs contributed 1.6 percentage points to
the 3.0% change in the yearly CPI rate, dwarfing all other categories,
with the biggest upward impact from the fuels and lubricants sub-sector,
which incorporates petrol.

The March consumer price data are due out on Tuesday, April 20.

Below are the results of the MNI petrol price index:

% change m/m

Apr-10 Mar-10 Feb-10 Jan-10 Dec-09 Nov-09
MNI PETROL PRICE INDEX 3.7 3.7 0.4 2.9 -0.2 3.4
CPI FUELS/LUBRICANTS n/a n/a 0.8 2.3 0.2 2.7

The Market News index is based on data from Experian.

The Experian data is derived from fuel prices obtained daily from
every petrol station in the UK that accepts fuel cards. The average
sample size is around 8,000 retail sites.

MNI constructs a single index which has usually correlated fairly
well with the official “fuels and lubricants” component of the CPI
index.

—London Bureau; Tel: +442076341624; email: drobinson@marketnews.com

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