Retail inflation hits 5-mth high of 3.36% on costlier veggies

The Bank of England is seen through the columns on the Royal Exchange building in London Britain

The all-India general CPI inflation accelerated to 3.36% in August 2017 (new base 2012=100), compared with 2.36% in July 2017.

"Rising prices for clothing and motor fuels were the main contributors to the increase in the rate between July and August", the ONS said. Retaining its neutral stance, RBI pinned future action on data, saying that wanted more confidence that inflation would move "close to 4 per cent on a durable basis".

The ONS said the all-items Consumer Prices Index (CPI), climbed 2.9% on the year in August, up from July's 2.6%.

The weaker level of the pound was behind the continued rise in clothing prices, as it's become more expensive for importers to bring clothing to the United Kingdom from overseas.

He explains that the September numbers used to determine the annual increases in pension and benefit levels are likely to exceed both wage inflation, now running at 2.1%, and the 2.5% underpin used for the triple lock.

In July, inflation remained at 2.6%, the level it had reached in June, with some economists suggesting it had "topped out". The current rate of inflation is the highest in five months.

"I see more deflationary forces than inflationary in the world economy at present. Rates are a racing certainty to be left on hold at this week's meeting [on Thursday], but as ever the minutes will be closely scrutinised for clues as to committee members' latest thoughts".

The bigger-than-expected rise in inflation comes ahead of the Bank of England's next announcement on interest rates, which is due on Thursday.

The year-on-year increase in output prices strengthened to 3.4% from 3.1%. Global inflation is running below expectations and there is a low inflation phenomenon that has immersed the global economy.

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