Sep 18, 2024, 6:10 PM
Sep 18, 2024, 6:04 AM

UK inflation unchanged at 2.2%

Provocative
Highlights
  • Annual inflation in the UK held steady at 2.2% in August, defying expectations of a rise to 2.3%.
  • Core inflation increased from 3.3% to 3.6%, driven by significant price growth in air fares, which rose by 11.9%.
  • The Bank of England's upcoming interest rate decision will be influenced by these inflation figures.
Story

In August, the annual inflation rate in the UK remained at 2.2%, contrary to predictions of a slight rise to 2.3%. This stability in consumer prices was notable as it occurred just before the Bank of England's upcoming interest rate decision. The Bank had previously reduced interest rates in August, aiming for a target inflation rate of 2%. Core inflation, which excludes volatile items like food and energy, saw an increase from 3.3% to 3.6%, surpassing economists' expectations of 3.5%. This rise indicates underlying inflationary pressures that may influence monetary policy decisions. The Office for National Statistics highlighted that air fares were a significant contributor to the price growth observed in August, with an increase of 11.9%. This surge in air travel costs reflects broader trends in consumer spending and demand, which can impact overall inflation metrics. As the Bank of England prepares to assess interest rates, the unchanged inflation rate and the rise in core inflation present a complex scenario. Policymakers will need to consider these factors carefully, balancing the need to support economic growth while managing inflationary pressures.

Opinions

You've reached the end