Inflation Data Due At 9:30 Am

[Realistbear]

Any guesses?

0.1% perhaps.

Title Edited.

[Realistbear]

http://uk.biz.yahoo.com/15092009/325/infla...ted-august.html

Tuesday September 15, 09:31 AM

Reuters

Inflation slows less than expected in August

LONDON (Reuters) - Consumer price inflation slowed less than expected in August as transport costs rose, partly offsetting a downward impact from utility bills and food prices, official data showed on Tuesday.

The Office for National Statistics said consumer prices rose 0.4 percent on the month to give an annual reading of 1.6 percent. That was the lowest reading since January 2005, but above analysts' expectations for a sharper easing to 1.4 percent.

The Retail Price Inflation price gauge, which includes housing costs and is used as a benchmark for pay deals, rose more than twice as fast as expected on the month, by 0.5 percent, taking the annual rate to -1.3 percent from -1.4 percent in July, and confounding expectations for an easing to -1.5 percent.

Inflation has fallen more slowly in Britain than in other countries, where annual CPI has already turned negative, but policymakers reckon the large amount of spare capacity built up during the recession will bear down on prices for some time to come.

The ONS said the largest downward impact on consumer price inflation came from gas and electricity bills, which were unchanged this year but rose sharply a year ago.

There was also downward pressure from food prices, which showed their biggest fall for a month of August since 2000, but rose by 1.4 percent on the month last August.

The biggest upward contribution to inflation came from transport, which rose on the month, having fallen at a record monthly pace in August last year.

There was also a large upward contribution from the price of second hand cars.

Annual services inflation slowed to 2.9 percent from 3.1 percent in July, the slowest rate since August 2006.

Edited September 15, 2009 by Realistbear

[insidetrack]

August down to 1.6% from 1.8% in July.

Everything fine and dandy on the good ship GB.

http://www.statistics.gov.uk/cci/nugget.asp?ID=19

Edited September 15, 2009 by insidetrack

[babesagainstmachines]

Actual 1.6%. I expected around 1.5%, so pretty close. Can I have my honourary degree from LSE now?

[RandomBear]

Deflation is SUCH a red herring. A few more months of this will put paid to QE big time.

[Realistbear]

G O C O M P A R E

Go &^*%$ &&%$#!!

Arrrrrrrrrrrrrgh! Its awful!!!

[porca misèria]

There was also a large upward contribution from the price of second hand cars.

Oh dear. So that's what unintended consequences look like.

Big expensive high-profile scrappage scheme should massage the CPI downwards so they can inflate further with new printing. But it turns round and bites them in the flank

[sign_of_the_times]

RB, why the selective highlighting?

The report clearly shows inflation is increasing, not falling

[OnlyMe]

Oh dear. So that's what unintended consequences look like.

Big expensive high-profile scrappage scheme should massage the CPI downwards so they can inflate further with new printing. But it turns round and bites them in the flank

Like they have given a shit what the real rate of inflation was for over a decade anyway?

All smoke and mirrors. The BOE and government have a gameplan of printing this country into prosperity, it has caused the biggest bubble ever seen in this country and caused the worst fleeing of productive capital and jobs offshore, like a committed gambler they are still trying the same again to see if the end result is different, it won;t, it will be the same BUT WORSE.

Any sensible company wishing to have a long term future on the global stage will be looking to remove as much exposure and investment in teh UK (and countries of similar ilk) as possible.

[Timm]

Has anyone got the actual Index figures?

I'll go and have a look...

Here we are. http://www.statistics.gov.uk/STATBASE/tsda...ore=N&All=Y

Jan 1987 100

July 2008 216.5

August 217.2

Sept 218.4

Oct 217.7

Jan 2009 210.1

June 2009 213.4

July 2009 213.4

August 214.4

Time to get a handful of index linked NSAI perhaps.

Edited September 15, 2009 by Timm

[mattyboy1973]

Wake up RB. Open your eyes to the possibility that you might be wrong. I suspect that might be rather hard for you.

[pikestones]

Has anyone got the actual Index figures?

I'll go and have a look...

CPI 111.4

RPI 214.4

RPIX 213.6

[redmen9]

My weekly shop which was about £60 a year ago is now over £100. And they say low food prices are contributing towards the fall in inflation!

[Caveat Mortgagor]

Stupid comment removed to save further embarrassment

Edited September 15, 2009 by Nick Dastardly

[General Melchett]

But, but, everything I want to buy seems to be getting massively more expensive.

[Realistbear]

Is this some kind of double-think?

If prices have remained unchanged this year, how have they exerted a downward impact on inflation?

Unemployment will be a huge factor.

Deflation is a good friend to those who want to see the continuation of the HPC. Being a renting bear deflation will be my friend.

However, if you have caught the gold bug and want house prices to drop too you are on the painful horns of a dilemma. Inflation is evbery gold bug's friend.

IMO, we are still headed Japanese. Brown may even pull of some more inflation but the cycle will not last as the bubble will still deflate and no one beats the market long term.

[Timm]

Is this some kind of double-think? If prices have remained unchanged this year, how have they exerted a downward impact on inflation?

Because most prices are up.

Add 5 to O and find the average.

The 0 drags the average down.

[I Told You So]

Agreed

I have noticed prices rise in many basic items in the last few weeks, bread/milk/crisps generally 3-5%. CPI is not going to stay low for long as soon last years high oil price drops out of the mix 3%+ here we come.

Oil price started to drop last Sept/Oct and by Nov it was $65, BoE are going to be in a pickle in 2/3 months time

[porca misèria]

Is this some kind of double-think?

If prices have remained unchanged this year, how have they exerted a downward impact on inflation?

nope, makes perfect sense. It's an artifact of counting year-on-year: a big rise affected the figures (upwards) for exactly 12 months, but has now dropped out of the headline rate.

[Caveat Mortgagor]

My weekly shop which was about £60 a year ago is now over £100. And they say low food prices are contributing towards the fall in inflation!

No, they say stable food prices are driving inflation down!!!!!

Maybe you are comparing the cost of your weekly shop with a weeks shopping 13 months ago? If so, the price then doesnt count any more I am afraid. Please send yourself to the attitude adjustment centre for re-programming.

FWIW we experienced a similar increase in our weekly food costs last summer/autumn. Inflation was 5% which was (ahem) pretty much in line with the increase of our grocery bill from £55 per week to £80 in a matter of only a couple of months - this has now crept up to £90!

Dont you just love that kind of stability?

[Timm]

Unemployment will be a huge factor. Deflation is a good friend to those who want to see the continuation of the HPC. Being a renting bear deflation will be my friend. However, if you have caught the gold bug and want house prices to drop too you are on the painful horns of a dilemma. Inflation is evbery gold bug's friend. IMO, we are still headed Japanese. Brown may even pull of some more inflation but the cycle will not last as the bubble will still deflate and no one beats the market long term.

RB, it's biflation. Full blown monetary biflation. Massive base money inflation, coupled with debt default and deleveraging.

Unless they change the rules (which I think they will), we will have hyper inflation at some point: probably when the boomers go to get their savings.

But not yet.

[OnlyMe]

Here's the CPI figs, The peak reading last year is highlighted below. So we could see a dip in the reading for next month and then tracking back up.

If I am reading this correctly by January this series (comparing YOY) will be reading 2.7% if the 111.4 level was maintained. In Jan the VAT reduction comes off - so another 2.5% added straight back onto shop prices (and wouldn't be surprised to see shops taking advantage of this move to shove in some extra rises at the same time).

Even this crappy little inflation index could be shot to shit in 6 months time, better hope GBP doesn't collapse further.

2008 01 105.5

2008 02 106.3

2008 03 106.7

2008 04 107.6

2008 05 108.3

2008 06 109

2008 07 109

2008 08 109.7

2008 09 110.3

2008 10 110

2008 11 109.9

2008 12 109.5

2009 01 108.7

2009 02 109.6

2009 03 109.8

2009 04 110.1

2009 05 110.7

2009 06 111

2009 07 110.9

2009 08 111.4

Edited September 15, 2009 by OnlyMe

[Caveat Mortgagor]

nope, makes perfect sense. It's an artifact of counting year-on-year: a big rise affected the figures (upwards) for exactly 12 months, but has now dropped out of the headline rate.

I walked into that one didnt I? Very careless schoolboy error!

Thanks to Timm as well. I thought I had spotted a difference between the way they described the various increases - My excuse is that I didnt think about it too much as I have begun to expect sloppy journalism.

[Jason]

Direct link: http://www.statistics.gov.uk/pdfdir/cpi0909.pdf

[jonb]

Is this some kind of double-think?

If prices have remained unchanged this year, how have they exerted a downward impact on inflation?

If two years ago, your gas bill was £10, last year it was £20, and it is now still £20, then that reduces inflation from 100% to 0%.