Consumer prices rose 6.8 percent year-over-year in July. It was 7.9 percent in June.
In Great Britain, inflation weakened significantly in July. Year-on-year, consumer prices rose by 6.8 per cent, the ONS statistics office announced in London on Wednesday. It was 7.9 percent in the previous month and 8.7 percent in May. On average, analysts expected inflation to ease to 6.7 percent in July.
Statisticians explained the weak inflation with falling prices for gas and electricity. Grocery prices continue to rise, but not as much as in the same month last year.
Core inflation is stubborn
On the other hand, core inflation, which ignores volatile energy and food prices, remained stable. Within this benchmark, the annual rate was 6.9 percent in July. Many experts consider so-called core inflation to be more meaningful than the overall rate.
The British pound hardly reacted to weak inflation. The exchange rate against the US dollar has only been able to appreciate at times. For some time now, the Bank of England has been fighting inflation by raising interest rates. If inflation falls faster than expected, that could reduce their willingness to raise interest rates further. (APA)
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