UK Retail Inflation Report summary
October 2024
Period covered: September 2024
3 minute read
Note: This report summary is one or two months behind the current month as standard reporting practice. The content is indicative only and incomplete with certain data undisclosed. Become a member to access this data or take out a free 30 day membership trial now.
Inflation
Headline Inflation Eases: The headline inflation measure rose by xx% in September YoY, down from xx% in August. This marks the lowest level of inflation since April 2021, surprising economists who had anticipated a drop to xx%.
Lower air fares and petrol prices provided downward pressure to the headline rate, which was partially offset by rising food and non-alcoholic beverages inflation.
Core Inflation Falls: Core CPI (excluding energy, food, alcohol, and tobacco) fell to xx% in September YoY, down from xx% in August.
Notable Slowdown in Goods and Services Inflation: Annual goods inflation fell further into negative territory, declining xx% in from -xx% in August.
Encouragingly, services inflation saw a notable decrease, falling from xx% to xx%, marking the first drop below xx% since May 2022. This significant decline was well below the Bank of England’s recent forecast of xx%.
Sterling Weakens: The pound lost over half a cent against the US dollar after the release of the inflation report, as prospects for further cuts in bank rate increased.
Transport Costs Decline: Transport prices fell by xx% YoY in September, the largest drop since October 2015, driven by sharp declines in air fares and motor fuel. Air fares plummeted xx% MoM, while petrol and diesel prices fell by xxp and xxp per litre respectively, leading to a xx% annual fall in motor fuel costs.
Food Prices Increase: Annual inflation for food and non-alcoholic beverages rose by xx% in September, up from xx% in August, marking the first rise since March 2023. Upward pressure came from the milk, cheese & eggs, water, soft drinks & juices and fruit components which was somewhat offset by the breads and cereals category.
Clothing and Footwear Inflation Eases: Prices in this category increased by xx% in the year to September, down from xx% in August – the lowest level in almost three years. Downward pressure came from women’s and men’s clothing.
Producer Prices Fall: Input prices for UK producers fell by xx% YoY, accelerating from a xx% drop in August. Factory gate prices (output prices) also declined, falling by xx%, reversing the small increase of xx% seen in August suggesting pressures in the supply chain are waning.
Take out a free 30 day trial subscription to read the full report >
The headline inflation measure rose by 1.7% in September
 (1).jpg)
Source: Retail Economics, ONS, seasonally adjusted
