UK inflation rises to 0.6%

The first set of fully post-Brexit consumer and producer prices data have today been released, which show the UK’s inflation rate, as measured by the Consumer Prices Index (CPI), rising from 0.5% to 0.6%, roughly in line with expectations. Though the figure fully captures the month of July, it would be premature to assume that this rise in inflation is the result of the UK’s decision to leave the European Union pushing up the cost of imports for manufacturers. The rise in input prices to 4.3% in the year to July, compared with a fall of 0.5% in the year to June, is more likely due to rising fuel prices feeding through to manufacturers. The pound is up, now trading at $1.2989 and the UK 10-year gilt is up at 0.54.