mardi 13 janvier 2015
U.K. Inflation Rate Drops to 0.5%, Lowest in Almost 15 Years
Posted on 02:09 by nice news
Britain’s inflation rate fell to the lowest in almost 15 years in December, which will force Governor Mark Carney to write the Bank of England’s first open letter explaining why prices are rising too slowly.
Consumer-price growth slowed to 0.5 percent from 1 percent in November, the Office for National Statistics said in London today. That’s the lowest since May 2000 and below the 0.7 percent median forecast of 37 economists surveyed by Bloomberg News. A separate report showed factory-gate prices recorded their biggest annual drop in five years.
The pound extended its decline against the dollar after the data were published and was at $1.5099 as of 9:33 a.m., down 0.5 percent from yesterday. U.K. 10-year gilts advanced.
Plunging oil costs and supermarket price wars are driving the sharp slowdown in U.K. inflation. With price growth below the BOE’s 2 percent target and a weak euro-area economy damping export demand, that’s helping Carney and his majority on the Monetary Policy Committee justify keeping the key interest rate at a record-low 0.5 percent.
The consumer-price data showed that food prices plunged 1.9 percent in December from a year earlier amid price cuts by supermarket chains including Tesco Plc and Wal Mart Stores Inc.- owned Asda to fend off competition from discounters. Reflecting the drop in crude oil, the price of gasoline has fallen about 18 percent from its 2012 peak, according to the statistics office.
MPC Debate
While two members of the nine-person MPC have called for higher interest rates in recent months, investors are all-but ruling out an increase this year, Sonia forward contracts show.
Inflation more than 1 percentage point away from the BOE goal requires Carney to write to Chancellor of the Exchequer George Osborne explaining the undershoot and how he intends to return it to target. Their exchange will be released on Feb. 18 alongside the minutes
Consumer-price growth slowed to 0.5 percent from 1 percent in November, the Office for National Statistics said in London today. That’s the lowest since May 2000 and below the 0.7 percent median forecast of 37 economists surveyed by Bloomberg News. A separate report showed factory-gate prices recorded their biggest annual drop in five years.
The pound extended its decline against the dollar after the data were published and was at $1.5099 as of 9:33 a.m., down 0.5 percent from yesterday. U.K. 10-year gilts advanced.
Plunging oil costs and supermarket price wars are driving the sharp slowdown in U.K. inflation. With price growth below the BOE’s 2 percent target and a weak euro-area economy damping export demand, that’s helping Carney and his majority on the Monetary Policy Committee justify keeping the key interest rate at a record-low 0.5 percent.
The consumer-price data showed that food prices plunged 1.9 percent in December from a year earlier amid price cuts by supermarket chains including Tesco Plc and Wal Mart Stores Inc.- owned Asda to fend off competition from discounters. Reflecting the drop in crude oil, the price of gasoline has fallen about 18 percent from its 2012 peak, according to the statistics office.
MPC Debate
While two members of the nine-person MPC have called for higher interest rates in recent months, investors are all-but ruling out an increase this year, Sonia forward contracts show.
Inflation more than 1 percentage point away from the BOE goal requires Carney to write to Chancellor of the Exchequer George Osborne explaining the undershoot and how he intends to return it to target. Their exchange will be released on Feb. 18 alongside the minutes
U.K. Inflation Rate Drops to 0.5%, Lowest in Almost 15 Years
Inscription à :
Publier les commentaires (Atom)
0 commentaires:
Enregistrer un commentaire