Wealth Manager - the site for professional investment managers

Register to get unlimited access to all of Citywire’s Fund Manager database. Registration is free and only takes a minute.

CPI inflation ends 10 month slide with sharp uptick to 1.8%

CPI inflation ends 10 month slide with sharp uptick to 1.8%

UK consumer price inflation (CPI) ended its ten month slide with a jump from 1.6% in March to 1.8% in April, but with producer price inflation still negligible the uptick is unlikely to be sustained.

In a month strongly affected by the relatively late date of Easter this year, transport costs such as airfares and fuels were the biggest gainer, rising 1.6% over the period.

‘This meant that prices for many goods (such as airfares) in April 2014 which were boosted by the Easter holidays were compared to a normal level of prices in April 2013,’ noted Samuel Tombs of Capital Economics.

‘Clearly, this boost to the annual inflation rate will unwind next month.’

Sterling nonetheless jumped to near a week-high of $1.685 versus the dollar, before rapidly falling back to $1.682. Gains versus the euro were more durable, holding at a year-to-date high of €1.228.   

Core factory gate prices continued to slow however, up just 1% over the year to April versus 1.1% in the year to March, suggesting that underlying pricing pressure continues to be marginal.

‘Price pressures in the inflation pipeline are still very weak,’ added Tombs.

‘Accordingly, we continue to think that CPI inflation should ease to as low as 1% by the end of this year and remain comfortably below the 2% target in 2015.’

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play Sam Vecht: the best opportunities in frontier markets

Sam Vecht: the best opportunities in frontier markets

Blackrock's Vecht evaluates frontier markets and explains where he sees the opportunities

Play Where A-rated Pattullo is finding the best bond opportunities

Where A-rated Pattullo is finding the best bond opportunities

Henderson Global Investors head of retail fixed income explains how he is managing his fund against the surprise current monetary policy divergence.

1 Comment Play Taxicab Tenner: Allianz Global Investors' AA-rated Simon Gergel

Taxicab Tenner: Allianz Global Investors' AA-rated Simon Gergel

Our much anticpated new series is here! We hand a black cab driver a tenner and grill the manager of the 125-year Merchants trust until the meter runs out.    

Your Business: Cover Star Club

Profile: meet the man building Towry into an £11bn giant

Profile: meet the man building Towry into an £11bn giant

As a former engineer who worked on Hong Kong International Airport, Rob Devey is not afraid of taking on major projects

Wealth Manager on Twitter