Edition: United States  
One News Page
“Probably the fastest-access news portal in the world”
> >

Inflation smashes Bank of England's two per cent target

City A.M. Tuesday, 21 March 2017
Inflation smashes Bank of England's two per cent targetInflation has smashed through the Bank of England’s two per cent target for the first time since November 2013 as the Office for National Statistics (ONS) changes its headline inflation measure.

Consumer price inflation (CPI), which has been the main measure of price rises since 2003, rose at an annual rate of 2.3 per cent in February, up from 1.8 per cent in January, according to the ONS.

The new measure, the catchily named consumer prices index including owner occupiers’ housing costs (CPIH), rose from two per cent in January to 2.3 per cent as well last month.

The ONS is now in the strange position of reporting two different measures of how much prices are rising in the UK.

The odd state of affairs has arisen because of flaws in the methodology for CPIH, which have meant the UK Statistics Authority has refused to grant "national statistic" status to the measure.

However, the Bank of England will continue to use CPI as its target for monetary policy, as mandated by the Treasury. This is thought to be unlikely to change before CPIH gains the stamp of approval from the Statistics Authority, with the Treasury currently having no plans to make a change.

However, the confusion is unlikely to have major policy implications given the level of the measures, with both easily above two per cent.

Rising transport costs caused by increases in the price of fuel were one of the main drivers of the headline increase in prices, the ONS said.

Meanwhile, food prices had a small upward effect on inflation for the first time since 2014.

Jonathan Athow, ONS deputy national statistician, said: “Inflation has risen to its highest rate for almost three and a half years with price increases seen across a range of items but with food and fuel having the largest impact."
0
shares
Share on
Facebook
Share on
Twitter
Post on 
Reddit
Share by
Email
 
Source: Reuters Studio - < > Embed

News video: UK inflation shoots past Bank of England target

UK inflation shoots past Bank of England target 01:29

British inflation last month shot past the Bank of England's 2 percent target for the first time since the end of 2013 and looks set to climb further due to the Brexit hit to the pound and rising global oil prices. David Pollard reports.

Recent related news

Fed keeps key interest rates unchanged amid low inflation

WASHINGTON (AP) — The Federal Reserve is keeping its benchmark interest rate unchanged at a time of low inflation, which remains persistently below the Fed's...
SeattlePI.com - Business

Bank of Japan Pushes Back Inflation Target Time Frame

Japan’s central bank pushed back its forecast for reaching 2% inflation for a sixth time under the leadership of Haruhiko Kuroda, further highlighting...
Wall Street Journal - MarketsAlso reported by •SeattlePI.com

Text of the Fed's statement after its meeting Wednesday

In view of realized and expected labor market conditions and inflation, the Committee decided to maintain the target range for the federal funds rate at 1 to...
SeattlePI.com - Business


You Might Like


Other recent news in Business

Starbucks is shuttering all of its TEAVANA stores as the retail apocalypse kills off American malls (SBUX)JOHN MCCAIN: Here's why I voted no and killed the 'skinny repeal'
Exxon nearly doubles SECOND QUARTER earningsReport: Prosecutors demand records on CHICAGO bank's loans to Paul Manafort
RUSSIA SANCTIONS BILL heads to Trump after Senate approvalApple kills iPod Nano, IPOD SHUFFLE as music moves to phones
Quincy Jones awarded $9.4 million from MICHAEL JACKSON estateSCARAMUCCI goes on tirade over leakers, lashes out at Priebus
GOP leaders, WHITE HOUSE chuck 'border tax' in win for retailers (Video)GIRL SCOUTS' new STEM badges boost local manufacturer's production

Twitter

Environmentally friendly: One News Page is hosted on servers powered solely by renewable energy
© 2017 One News Page Ltd. All Rights Reserved.  |  About us  |  Disclaimer  |  Press Room  |  Terms & Conditions  |  Privacy Policy  |  Content Accreditation
 RSS  |  News for my Website  |  Free news search widget  |  Help  |  Contact us  |  DMCA / Content Removal
How are we doing? Send us your feedback  |   LIKE us on Facebook   FOLLOW us on Twitter   FIND us on Google+