Free Trial

MNI UK Inflation Insight: October 2024

We look at the persistence of the upside surprises and the implications for the MPC.
  • UK inflation came in a little higher than the BOE’s slightly above consensus forecast – with the upside risks that we had been flagging in our preview to second hand car prices and air fares both crystalising to see headline CPI increase to 2.28%Y/Y.
  • That is a 0.60ppt increase, 0.05ppt more than the BOE’s November MPR had baked in, but 0.13ppt above the MNI mean (and one tenth above the MNI median).
  • Of the 0.60ppt increase in headline CPI, there was an expected contribution of 0.57ppt from utilities alone – with other categories generally balancing each other out (although energy had a smaller 0.49ppt contribution due to a negative contribution from petrol/diesel).
  • We think most of the upside surprises will remain higher persistently but we don't think there is enough here to see the BOE move away from it's "gradual" path for the next couple of quarters.

For the full document see: MNI UK Inflation Insight - November 2024 Release.pdf

156 words

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
  • UK inflation came in a little higher than the BOE’s slightly above consensus forecast – with the upside risks that we had been flagging in our preview to second hand car prices and air fares both crystalising to see headline CPI increase to 2.28%Y/Y.
  • That is a 0.60ppt increase, 0.05ppt more than the BOE’s November MPR had baked in, but 0.13ppt above the MNI mean (and one tenth above the MNI median).
  • Of the 0.60ppt increase in headline CPI, there was an expected contribution of 0.57ppt from utilities alone – with other categories generally balancing each other out (although energy had a smaller 0.49ppt contribution due to a negative contribution from petrol/diesel).
  • We think most of the upside surprises will remain higher persistently but we don't think there is enough here to see the BOE move away from it's "gradual" path for the next couple of quarters.

For the full document see: MNI UK Inflation Insight - November 2024 Release.pdf