UK Inflation Eases On Falling Fuel, Clothing Prices Ahead Of Lockdown

UK inflation slowed to a three-month low in March on falling fuel and clothing prices ahead of the coronavirus lockdown, data from the Office for National Statistics showed Wednesday.

Consumer price inflation eased to 1.5 percent from 1.7 percent in February. This was the lowest rate since last December, when prices rose 1.3 percent. The rate came in line with expectations.

On a monthly basis, consumer prices remained flat after climbing 0.4 percent in February.

Excluding food and energy, core inflation slowed marginally to 1.6 percent from 1.7 percent a month ago.

Prices of clothing and footwear were down 1.2 percent. Petrol prices fell to the lowest level in more than a year in March.

The ONS said prices were collected around March 17, before the formal government lockdown was introduced on March 23.

As people spend more time at home, there might have been less interest in clothing and there was a shift in spending patterns towards necessities such as food and cleaning products.

Bank of England policymaker Silvana Tenreyro said last week that it is difficult to interpret inflation data during Covid-19. She forecast inflation to fall below 1 percent in the next couple of months, well below the central bank's 2 percent target.

In March, inflation took the first leg of what is suspected to be a sustained journey down to around 0.5 percent by the summer, Andrew Wishart, an economist at Capital Economics, said.

Another report from the ONS showed that output price inflation slowed to 0.3 percent in March from 0.5 percent in February, largely due to petroleum product prices. Economists had forecast a marginal 0.1 percent rise.

On a monthly basis, output prices decreased 0.2 percent for the second straight month compared to a forecast of 0.3 percent fall.

At the same time, input prices declined 2.9 percent annually, much faster than the 0.2 percent drop seen in February. This was the lowest rate since October 2019. Nonetheless, this was slower than the expected 3.2 percent fall.

Month-on-month, input prices were down 3.6 percent versus the forecast of -3.5 percent and February's 0.9 percent decrease.

In a separate release, the ONS said house price growth eased to 1.1 percent in February from 1.5 percent in January.

The statistical office said data collection for February was largely unaffected by the COVID-19. There was a general slowdown in house price growth over the last three years, the ONS noted.

US Dollar vs CAD (FX:USDCAD)
FXチャート
から 3 2024 まで 4 2024