UK Inflation Posts Surprise Retreat in September

Source: Office for National Statistics

Inflation in the United Kingdom posted a surprise deceleration in September, following the uptick recorded the previous month. EWU is down 0.50% premarket.

• The Consumer Price Index (CPI) posted an annual inflation rate of 3.1%, following the 3.2% recorded the previous month and 0.5% a year ago.
• The latest reading is slower than the 3.2% expectations of economists but in line with the downtrend projection of several respondents.
• The biggest upward drivers were transport, housing, restaurants and hotels, and recreation and culture.
• The Consumer Prices Index, including owner occupiers’ housing costs (CPIH), slowed to 2.9% from 3.0% in August but up from 0.7% last year.
• The deceleration was slightly offset by transport, furniture and household, food, and non-alcoholic beverages.
• Restaurants and hotels contributed the biggest to the downtrend mainly due to the base effect, as the sector recovered last year after the Eat Out to Help Out scheme.