Finance Matters

Posts Tagged ‘Office for National Statistics’

The Office for National Statistics (ONS) today announced Consumer Price Inflation (CPI) rose to annual rate of 4.5% last month from July’s rate of 4.4%.

However, the figure was in line with analysts’ expectations.

Higher inflation continues to be led by rising food costs but the main reason behind last month’s rise was a 5.1% annual increase in the housing, water, electricity and gas component – which rose the most in more than two years.

Utility companies recently hiked their prices – some by almost 20%.

However, clothing and footwear was also a contributor to higher inflation last month.

UK inflation continues to remain more than double the target of 2% and has been above this level since December 2009 and is expected to remain above target during 2012.

The Bank of England has previously warned that inflation could reach 5% later this year, driven higher by rising energy and food costs but should return to target by 2013.

Meanwhile, Retail Price Inflation (RPI), which includes mortgage costs and is used as the basis for many wage deals, rose to 5.2% in August from 5% in July.

Inflationary pressures are rife throughout the world, particularly in Asia, and many central banks have opted to lift interest rates to combat stubbornly high inflation.

However, the Bank of England last week opted to keep rates at the historic low of 0.5%, suggesting it is reluctant at this stage to lift interest rates as it could be harmful to the economic recovery.

Last month, policymakers Martin Weale and Spencer Dale dropped their call for higher interest rates and joined their fellow Committee members by opting to keep rates low to stimulate the recovery.

The economy appears to be stuttering at present and many experts believe the central bank may re-introduce the quantitative easing (QE) programme – designed to stimulate growth within the economy.

In other news today, the ONS reported that the UK goods trade deficit unexpectedly widened in July.

The Office for National Statistics (ONS) has today revealed UK producer output prices held steady in August – remaining at the highest annual rate since October 2008.

According to the ONS, output prices (factory gate) annual inflation for all manufactured products held steady at July’s upwardly revised reading of 6.1% in August.

The figures were a surprise to analysts who had expected a modest fall.

Meanwhile, input prices for August slowed to 16.2% on an annual basis – the lowest level since March – attributed to falling fuel prices. Oil prices have fallen by around one fifth from their 2011 peak in May.

Analysts had expected input prices to rise to 16.7%.

On a monthly basis meanwhile, output prices rose 0.1% from July when they increased by a revised 0.3%, while input prices fell 1.9% on the month – the most since April 2009.

The gain in monthly output prices was attributed to a 1% increase in chemicals and pharmaceuticals, the ONS said, while the fall in input prices was led by a 5.9% drop in crude oil.

According to analysts, today’s figures suggest producer and consumer price inflation could slow in the short-term.

The figures come as the Bank of England opted to keep interest rates at the historic low of 0.5% yesterday.

Interest rates have now been at this low level since March 2009 – when the economy was in the midst of recession.

Recent figures show the economy appears to be faltering so it was understood that the central bank is reluctant at this stage to lift interest rates as the recovery is losing momentum.

Some economists believe the bank will not lift rates again until 2013.

However, the Bank has come under pressure lately to lift interest rates to combat stubbornly high inflation – which is currently running at more than double the 2% target.

Some analysts believe the central bank may restart its quantitative easing (QE) programme in the near future, particularly if the economy weakens further.

Following today’s release of data, sterling remained higher against the dollar, trading at $1.5988 – up 0.2% from yesterday.

The Office for National Statistics (ONS) has today revealed UK factory output shrank by 0.2% in July after a flat reading the previous month. The reading was worse than economists had expected and confirm weak prospects for the economy after the figures suggest a poor start to the third quarter. The fall was attributed to [...]

The Office for National Statistics (ONS) has today revealed UK factory output shrank by 0.2% in July after a flat reading the previous month. The reading was worse than economists had expected and confirm weak prospects for the economy after the figures suggest a poor start to the third quarter. The fall was attributed to [...]

The Office for National Statistics (ONS) has today revealed UK factory output shrank by 0.2% in July after a flat reading the previous month. The reading was worse than economists had expected and confirm weak prospects for the economy after the figures suggest a poor start to the third quarter. The fall was attributed to [...]