Latest data released by ONS - 17 June 2020

  • Prior +0.8%
  • Core CPI +1.2% vs +1.3% y/y expected
  • Prior +1.4%

Slight delay in the release by the source. Headline UK inflation slumps to a four-year low in May with the core reading also at its weakest level since October 2016.

The deflationary pressures from the economic fallout from the virus outbreak is becoming more evident and this will only add to pressure to the BOE to do more and add more stimulus - potentially start to look at negative rates - to address the issue.

Some other details on the day as producer price and retail price figures are released:

  • PPI output -0.3% vs -0.1% m/m expected
  • PPI output -1.4% vs -1.0% y/y expected
  • PPI input +0.3% vs +4.2% m/m expected
  • PPI input -10.0% vs -6.4% y/y expected
  • RPI -0.1% vs +0.1% m/m expected
  • RPI +1.0% vs +1.2% y/y expected