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Inflation (July 2020) Preview - 0070BST

UK DATA
MNI (London)

CPI: BBG: -0.1% m/m, +0.6% y/y; Prev (Jun) +0.1% m/m, +0.6%y/y

Core CPI: BBG: 1.3% y/y; Prev (Jun) 1.4% y/y

CPIH: BBG: +0.8% y/y; Pre(Jun) +0.8% y/y

  • Y/Y inflation is expected to remain unchanged at 0.6% in Jul, after ticking up in June to 0.6% from May's 4-year low of 0.5%.
  • Last month's uptick was mainly driven by upward contributions from recreation and culture, namely computer games and consoles.
  • Surprisingly, upward pressure also arose from clothing and footwear, possibly linked to further discounts by retailers.
  • Neither category is following the usual seasonal pattern due to the pandemic.
  • Jul's services PMI is in line with market forecasts, noting that output charges were broadly unchanged.
  • On the other hand, the BRC shop price index showed an annual decline by 1.3% of prices in Jul, although at a slower pace than in the previous month due to a slower fall in non-food prices.
MNI London Bureau | +44 203-865-3814 | irene.prihoda@marketnews.com

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