United Kingdom: Inflation falls to lowest level in over two years
May 22, 2012
In April, consumer prices added 0.6% over the previous month, which doubled the 0.3% rise registered in March but was in line with market expectations. The increase was mostly the result of higher prices for alcohol and tobacco, transport as well as for housing and household services. In contrast, prices for food and non-alcoholic beverages inched down over the previous month. Despite the strong monthly print, annual inflation moderated from 3.5% in March to 3.0% in April, which represents the lowest rate since February 2010. Building on the lower annual rate, annual average inflation inched down from 4.3% in March to 4.2% in April. Based on figures from its latest inflation report from May, the Bank of England expects inflation to average 3.2% this year.