Rolling coverage of the latest economic and financial news
The new chancellor John Healey has said that while a falling rate of inflation is welcome news, there is still much more the government should do to help.
He said in a statement this morning:
Falling inflation is news families want to hear but there is much more to do to give people the breathing space they need.
That is why yesterday we cut VAT on electricity bills and today we’re announcing a £2 cap on bus fares from January. We have chosen to focus on the cost of living in our first week, signalling that concern for working people will be at the heart of everything we do.
Food prices fell this month, driven by products including chocolate, margarine and beef. Clothing prices also fell with the start of summer sales, with bigger discounts than last year.
The cost of raw materials dipped for the first time since January, mainly due to the lower price of crude oil, while the increase in the costs of goods leaving factories slowed again.
Lower fuel prices applied the brakes to inflation in June, but this rear-view mirror picture doesn’t tell us much. With oil prices rising again amid renewed tensions in the Middle East, there could be inflation issues further down the road.
For the Bank of England, the crucial question is whether this remains an energy shock or becomes a domestic inflation problem. So far, a cooling labour market suggests there is little risk of the sort of second-round effects that would warrant tighter monetary policy.
7am BST: UK inflation for June
7am BST: Wetherspoon Q4, Reach half-year results
9pm BST: Alphabet Q4 results
Continue reading...
Rolling coverage of the latest economic and financial newsThe new chancellor John Healey has said that while a falling rate of inflation is welcome news, there is still much more the government should do to help.He sa...
See more
