Inflation rises to 1.8%: ONS

Feb 17, 2017, 00:19
Inflation rises to 1.8%: ONS

China consumer inflation also rose more than expected, nearing a three-year high as fuel and food prices jumped, data showed on Tuesday.

US retail sales and inflation rose in January, strengthening the case for the central bank to raise interest rates.

Fuel & power group registered a rise in prices for the sixth straight month, on a y-o-y basis.

Kristin Forbes, one of the nine rate-setters on the Bank's Monetary Policy Committee, signalled last week that she was inching closer to voting for a rate rise after becoming increasingly "uncomfortable" with surging inflation given the economy's resilience to the Brexit vote.

Wholesale food costs were unchanged in January.

The EU measure of inflation, or HICP, climbed 1.9 percent yearly in January, faster than the 1.7 percent rise in the prior month.

The Bank expects inflation to rise "markedly" above the 2% target over the coming months as a result of the weakness in the pound.

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Europe's index of leading 300 stocks .FTEU3 closed up 0.4 percent to 1,465.05, its highest since December 2015, buoyed by bank earnings.

Meanwhile, the all-India consumer price index (CPI) on base 2012=100 stood at 3.17 (provisional) in January, 2017 compared to 3.41 (final) in December, 2016 and 5.69 in January, 2016, according to the Central Statistics Office, ministry of statistics and programme implementation.

The December price report showed a modest increase in the overall rate of inflation, however the core remained unchanged from its rate over the previous year.

Food prices, the biggest component of CPI, rose 2.7 percent in January, led by a 7.1 percent increase in the price of pork.

True Potential deputy chief investment officer Chris Leyland warned the rising figure - not matched by rising interest rates from the BoE - would continue to hit savers hardest. Prices in London alone rose 7.5 per cent on the year.

Until recently shoppers have benefited from falling food prices and a supermarket price war but this is rapidly unwinding thanks to factors such as blighted Spanish harvests pushing up the cost of courgettes and turning Iceberg lettuces into a rare treat. This pushed up import costs, which in turn boosted consumer prices and caused inflation to increase.

Food prices showed the smallest annual decrease since July 2014 as the cost of chocolate and candies rose by nearly five per cent on the month.