14/08/2001

Inflation rate fall may herald a further interest rate cut

Speculation is growing that a fall in the underlying inflation rate, down to 2.2 per cent, may give the Bank of England’s Monetary Policy Committee further room for manoeuvre to lower interest rates.

Continued severe pressure on manufacturing industry has prompted further calls from industry leaders seeking another cut in the UK interest rate. While analysts had expected the underlying rate of inflation to drop by 0.1 per cent, figures released on Tuesday 14 August by the Office for National Statistics revealed that the rate had dipped by 0.2 per cent.

The all items index RPIX, which excludes mortgage interest payments, showed that inflation rose by 2.2 per cent, down from 2.4 per cent last month.

This is well below the Bank of England’s projected inflation target of 2.5 per cent on the year.

The drop has been attributed to substantial reductions in food prices particularly seasonal produce, which following worries over quality and supply, had experienced a steep rise in July.

The next inflation rate report is due to be produced on September18.

The general Retail Prices Index (RPI) is the main domestic measure of inflation in the UK.

The RPI measures the average change from month to month in the prices of goods and services purchased by most households in the UK.

(SP)

Related Northern Ireland Business News Stories
Click here for the latest headlines.

20 November 2017
Innovate UK Announce Mission To Singapore
Innovative businesses operating in the Advanced Urban Services sector are invited to apply for a place on an Innovate UK hosted mission to Singapore from 29 January to 02 February.
08 July 2019
Brexit Planning Workshops To Assess Trading Impact For Firms
Businesses are set to gather at a post-Brexit planning workshop held in Belfast ahead of the UK's planned withdrawal from the EU on or before 31 October 2019. As negotiations continue, the session will focus on trade arrangements within the UK's exit agreement as well as transitional plans.
23 January 2019
Innovate UK Announce Creative Industry Mission To India
Innovate UK has announced a Global Business Innovation Programme for the creative and media sectors to showcase the best of UK creativity in India. The fully funded programme consists of a preparation phase in the UK, a 5-day visit to India in April 2019 and subsequent follow-up support.
20 June 2019
Percentage Of NI Firms In Active Innovation Falls
Figures published by the Northern Ireland Statistics and Research Agency (NISRA) have revealed a decline in the amount of firms in active innovation. 39% of businesses engaged in innovation activities in the period 2014-16, a figure down from 45% between 2012 and 2014.
18 June 2002
UK inflation rate falls below two per cent
Official figures from the Office for National Statistics (ONS) has revealed that the UK inflation rate fell sharply last month to 1.8% in May from 2.3% in April.