UK producer price inflation rises to two-year high in June
It hit 1.9% in June, up from 1.3% in May
[LONDON] British producer output price inflation rose to a two-year high of 1.9 per cent in June, up from 1.3 per cent in May, according to preliminary official data which adds to signs of inflationary pressures facing the British economy.
Britain’s Office for National Statistics (ONS) suspended the publication of PPI data in March after discovering calculation errors dating back to 2020. Wednesday’s (Aug 27) figures represent interim data before regular publication resumes in October.
In July, the ONS said initial analysis showed that producer price inflation in previous years had been higher than originally calculated.
Wednesday’s figures showed further upward revisions, with a previously reported 0.5 per cent producer output price inflation rate for the year to April revised up to 0.7 per cent. However, the ONS said the overall changes were in line with its previous expectations.
Producer input prices in the year to June were down by 1.0 per cent in the year to June after a similar decline in May, which the ONS said was driven by a 24.1 per cent annual drop in the cost of crude oil and natural gas.
Producer prices data is used by economists including those at the Bank of England to judge the strength of underlying inflationary pressures in the economy and their likely impact on consumer prices.
British CPI rose to an 18-month high of 3.8 per cent in July – the highest among major advanced economies – and the Bank of England forecasts it will reach 4 per cent in September.
PPI data is also used for inflation adjustments in British gross domestic product, trade and construction statistics. The ONS said it expected the impact of the changes on published GDP data for 2025 to be “negligible”. REUTERS
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