Producer price inflation fears alleviated


The UK's producer price index rose by 2.8 per cent in the 12 months to July, reflecting volatile energy markets and rising petrol prices, official statistics have revealed.

This month's increase in the output price index for home sales of manufactured products compares favourably to the 3.4 per cent growth experienced in the year to June.

Today's government announcement is an indicator of the price levels that wholesalers and manufacturers have paid during the last month, with consumers set to feel the effects of any changes in household prices during the coming months.

Howard Archer, chief UK and European economist at research firm Global Insight, said that this month's data was "more benign than expected", explaining that the seasonally-adjusted rise of 0.1 per cent between June and July should "temper concerns" that high energy prices were adversely affecting individual price indices.

"Nevertheless, with input prices rising sharply in July itself and oil prices hitting new highs in early August, manufacturers will still be looking for opportunities to pass on more of their higher costs and boost their margins," he added.

Wholesale tobacco and alcohol prices were shown to be up by 2.4 per cent, while output prices excluding food, beverages and petrol rose 2.5 per cent.

The largest price increase was felt by the material and fuel sector, which went up 9.7 per cent.

Mr Archer concluded that although today's results were surprisingly healthy, the Bank of England's ongoing inflation concerns meant that a further interest rate hike was likely before the end of the year.

Bookmark with:
Bookmark with: Digg Digg Bookmark with: Delicious Bookmark with: Reddit Reddit Bookmark with: StumbleUpon StumbleUpon Bookmark with: Google Google Bookmark with: Technorati Technorati Bookmark with: Netvouz Netvouz

Latest News:

Search News
News Front Page
Accountancy / Tax
Advertising / PR
Armed Forces
Aviation / Aerospace
Banking / Finance
Charities / Voluntary
Childcare / Youth
Construction / Property
Customer Services
Education / Training / Teaching
Emergency Services
Engineering / Electronics
Entertainment / TV / Theatre
Graduate Roles
HR / Recruitment
Health / Beauty
Hotel / Catering / Restaurants
IT / Internet
Insurance / Pensions
International / Overseas
Management / Business
Manufacturing / Industry
Media / New Media / Creative
Medical / Healthcare
Pharmaceutical Industry
Public Sector
Retail / Wholesale
Sales / Purchasing / Marketing
Science / Technology
Secretarial / PA / Admin
Skilled / Semi-skilled Manual
Transport / Logistics
Travel / Tourism / Leisure