- UK CPI rises 0.5% YoY in May vs. +0.5% expected.
- Monthly UK CPI arrives at 0% in May vs. 0% expected.
- GBP/USD heads back towards 1.2587 on the data release.
The UK Consumer Prices Index (CPI) 12-month rate came in at +0.5% in May when compared to +0.8% booked in April while matching expectations of a +0.5% print, the UK Office for National Statistics (ONS) reported on Wednesday.
Meanwhile, the core inflation gauge (excluding volatile food and energy items) arrived at +1.2% YoY last month versus +1.4% booked in April while missing the consensus forecast of +1.3%.
The monthly figures showed that the UK consumer prices arrived at 0% in May vs. 0% expectations and -0.2% last.
Main points (via ONS):
- “The largest contribution to the CPIH 12-month inflation rate in May 2020 came from recreation and culture (0.23 percentage points).”
- “Falling prices for motor fuels and a variety of recreational and cultural goods resulted in the largest downward contributions to the change in the CPIH 12-month inflation rate between April and May 2020.”
- “Rising prices for food and non-alcoholic drinks resulted in a partially offsetting upward contribution to change.”
- “As a result of the ongoing coronavirus (COVID-19) pandemic, we identified 74 CPIH items (or 14.2% of the CPIH basket by weight) that were unavailable to UK consumers in May, as detailed in table 58 of the Consumer price inflation dataset; this is down from 90 unavailable items in April; compared with the February 2020 index (the most recent “normal” collection), we have collected a weighted total of 81.6% (excluding unavailable items) of the number of price quotes for the May 2020 index, although the coverage varies across the range of items.”
Separately, the UK Producer Price Index (PPI) – Input for May arrived at -10.0% YoY vs. -6.0% expected and -9.8% previous. The PPI Core Output came in at +0.6% YoY in May vs. +0.6% expected and +0.6% prior.
May’s Retail Price Index stood at -0.1% MoM vs. +0.1% expected and 0% prior. On an annualized basis, the index dropped to +1.0% in May vs. +1.2% forecasts and +1.5% seen in April.
Following the mixed UK CPI numbers, the GBP/USD pair jumps back towards the daily highs of 1.2587, recovering most losses.
The spot trades flat at 1.2574, at the time of writing.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.