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UK April inflation rate below forecasts at 2.1%

Christian Fernsby |
The annual inflation rate in the United Kingdom increased to 2.1% in April 2019 from 1.9% in the previous month but below market expectations of 2.2%.

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It was the highest inflation rate in four months, mainly boosted by a rise in energy bills as Britain's energy regulator increased a price cap on energy providers by 10%.

Year-on-year, prices went up further for housing, water, electricity, gas and other fuels (3.4% compared to 1.2% in March); transport (4.7% compared to 3.3%); miscellaneous goods and services (0.9% compared to 0.6%); and communication (4.6% compared to 3.7%).

Meanwhile, cost eased for food and non-alcoholic beverages (0.7% compared to 0.8%); restaurants and hotels (2.4% compared to 2.8%); household equipment and maintenance (0.2% compared to 0.6%); recreation and culture (1.5% compared to 2.7%); health (2.3% compared to 2.5%); and alcoholic beverages and tobacco (3.9% compared to 5.2%).

Additionally, cost of clothing and footwear fell at a faster pace (-1.9% compared to -1.6%) and inflation was steady for education (at 3.1%, the same as in March).

The consumer prices index including owner occupiers’ housing costs (CPIH) rose to 2.0% in April from 1.8% in March.

The annual core inflation rate, which excludes prices of energy, food, alcohol and tobacco, advanced by 1.8%, the same as in March and slightly below market forecasts of 1.9%.

On a monthly basis, consumer prices rose 0.6%, after a 0.2% gain in the prior month but lower than market consensus of 0.7%.

Prices advanced further for housing, water, electricity, gas and other fuels (2.5% compared to 0.1%); health (0.8% compared to 0.3%); communications (1.3% compared to 0.2%); and miscellaneous goods and services (0.4% compared to 0.2%).

Also, cost of transport rebounded (2.4% compared to -0.1%). On the other hand, prices declined for food and non-alcoholic beverages (-0.3% compared to 0.1% in March); furniture and household equipment (-1.2% compared to 0.1%); and recreation and culture (-0.8% compared to 0.2%).


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