CPI should bounce higher in May though

Inflation Nearly Halves in UK During April

Posted Wednesday, May 20, 2020 by
Skerdian Meta • 1 min read

Inflation used to be at around 2% in the UK, but in the last several months of 2019 CPI (consumer price index) softened to 1.3%. In January the CPI jumped back up to 1.8%, while cooling off to 1.7% in February and to 1.5% in March. But, with the decline in Oil prices in the last two months, expectations were for inflation to cool off further. It did indeed, falling to 0.;8%. Although we might see a climb in May, as Oil prices climb back up.

Latest data released by ONS – 20 May 2020

  • April CPI YoY +0.8% vs +0.9% expected
  • March CPI stood at +1.5%
  • Core CPI YoY +1.4% vs +1.4% expected
  • March core CPI stood at +1.6%
Slight delay in the release by the source. The headline reading slumps to its weakest level since August 2016 as the fallout from the virus outbreak and softer energy prices last month helped to drive inflation pressures lower. The good news is that core inflation held up somewhat but it still matches the low seen back in December last year, which was at the time the weakest level since November 2016.
Some other details on the day as producer price and retail price figures are released:
  • PPI MoM output -0.7% vs -0.5% expected
  • PPI YoY output -0.7% vs -0.5% expected
  • PPI MoM input -5.1% vs -4.3% expected
  • PPI YoY input -9.8% vs -8.8% expected
  • RPI MoM 0.0% vs 0.0% expected
  • RPI  YoY+1.5% vs +1.6% expected
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