MNI DATA BRIEF: UK July RPI Elevated, Even as CPI Retreats

The UK's Retail Price Index (RPI) retreated only modestly in July to an annual rate of 3.8% from 3.9% a month earlier, exceeding analysts' expectations. Much of the elevated RPI derives from the recent appreciation in house prices, although insurance and the cost of second-hand cars also have a higher weight in the RPI than in the CPI, according to an ONS official.

RPI excluding mortgage interest payments steadied at an annual rate of 3.9% last month, matching the highest rate since January of 2018. The July RPI data -- this month's -- is traditionally used as a benchmark for annual increases for items such as next year rail fare increases.