The rate of inflation faced by households has accelerated slightly. The Consumer Prices Index, increased by 1.3% in the year to October 2014, up from 1.2% in the year to September. Analysts were expecting no change. Prices for transport costs – notably motor fuels and air fares were the main contributors to the rise. While prices for these products have fallen compared to last month, there were larger falls between the same two months a year ago. Falling food and motor fuel prices continue to have an impact on the rate of inflation. Food prices have fallen by 1.6% over the last year and motor fuels by 4.8%. If the price falls for these products were excluded from the CPI, the inflation rate for the last year would be 0.3 percentage points higher. In other words the rate of inflation would be 1.6% rather than 1.3%. Month on month, the input price measure of UK manufacturers materials and fuels, fell 1.5% between September and October, missing forecasts on decline by 1.4% f , compared with a fall of 0.6% between August and September. After the data Sterling was pushed higher and is currently being traded few points 1.5660 level. Later today, in the US session, PPI and NAHB Housing Market Index figures are scheduled for release.
Last modified on Tuesday, 18 November 2014
