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UK inflation holds steady at 2.4% in October | UK inflation holds steady at 2.4% in October |
(35 minutes later) | |
The UK inflation rate remained steady at 2.4% in October, confounding analyst expectations of a rise to 2.5%. | The UK inflation rate remained steady at 2.4% in October, confounding analyst expectations of a rise to 2.5%. |
The Consumer Prices Index (CPI) figure included falls in food and clothing costs, but rising utility bills and petrol prices, said the ONS. | |
The inflation figure comes a day after data showed that wages were rising by 3.2% - the fastest pace in nearly a decade. | The inflation figure comes a day after data showed that wages were rising by 3.2% - the fastest pace in nearly a decade. |
Core inflation also held steady at 1.9% in October. | Core inflation also held steady at 1.9% in October. |
That figure strips out the out the effects of energy, food, alcohol and tobacco prices. | |
Has inflation peaked? | |
Inflation hit a five-year high of 3.1% in November 2017, as the inflationary effect of sterling's decline after the June 2016 Brexit vote hit its peak. | |
However, it is still above the Bank of England's 2% target. | |
The ONS's head of inflation, Michael Hardie, said: "Prices paid by consumers continued to rise at a steady rate, with falls in food and clothing offset by rising utility bills and petrol, as crude [oil] prices continued to rise." | |
The Bank of England expects inflation will drift lower, but expects to have to raise interest rates in coming years to keep inflation at or near its target figure. | |
How have manufacturers coped? | |
Looking at the latest date, for manufacturers, the cost of raw materials was 10% higher than in October 2017. | |
And manufacturers increased the prices they charged by 3.3% year-on-year compared with 3.1% the previous month. | |
How have house prices been affected? | |
The ONS said house prices in September rose by an annual 3.5% against 3.1% in August. | |
But prices in London fell for a third month running, down by 0.3%. | |
Is there a Brexit factor? | |
According to Laith Khalaf, senior analyst at Hargreaves Lansdown: "Brexit is still the elephant in the room when it comes to the future path of inflation, and consequently of monetary policy. | |
"That's because the pound now waxes and wanes with the Brexit negotiations, and that has a big impact on how much UK consumers pay for imported goods." |