United Kingdom: Inflation falls to over one-year low in August
Inflation came in at 6.7% in August, down from July’s 6.8% and well below market expectations of 7.0%. August’s reading represented the weakest inflation rate since February 2022. That said, inflation was still far above the BoE’s 2% target rate. Looking at the details of the release, prices for food and recreation and culture grew at a softer rate in August. In contrast prices for transportation declined at a less pronounced pace, likely linked to the recent rise in international oil prices.
Accordingly, the trend pointed down slightly, with annual average inflation coming in at 9.3% in August (July: 9.5%). Meanwhile, core inflation fell to 6.2% in August, from July’s 6.8%.
Finally, consumer prices rose 0.34% over the previous month in August, contrasting the 0.43% drop seen in July.