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Intermediate Infla Falls Sharply On Oil.....>

UK DATA: Intermediate Infla Falls Sharply On Previous Oil Price Decline
-UK Aug Input PPI -0.8% y/y vs +0.9% in July
-UK Aug Output PPI +1.6% y/y vs +1.9% in July
-UK Aug Core Output PPI +2.0% y/y, unchanged from July
Pipeline inflation fell sharply, courtesy of an earlier retreat in oil 
prices, but sterling weakness could reverse those declines in months to 
come. Annual input PPI has not fallen by such a large margin since May 
2016, while the output measure recorded its joint-lowest rise since 
September 2016. Crude oil prices had declined by 11.6%, subtracting just 
over 2 percentage points from input PPI. However, the sterling effective 
exchange rate declined by 1.7% between July and August (the 5th 
consecutive monthly fall) and by an annual rate of 3.4%, leaving the 
rate at its lowest leve since October 2016. Weaker sterling and the 
recent push higher in oil prices could spell renewed inflation in the 
fourth quarter. 

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