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Inflation rate falls to zero

‘The rate of UK Consumer Prices Index inflation fell to 0% in June, from 0.1% in May, official figures show. Bank of England governor Mark Carney has said he expects inflation to remain low in the immediate short term, picking up around the turn of the year. The rate of Retail Price Index (RPI) inflation – which includes housing costs such as mortgage interest payments and council tax – was 1% in June, unchanged from May. Mr Carney dismissed suggestions that inflation’s fall back to zero would prevent a rise in interest rates. “The point at which interest rates may begin to rise is moving closer with the performance of the economy, consistent growth above trend, a firming in domestic costs, counter balanced somewhat by disinflation imported from abroad,” the governor said.

Source: The Times, Financial Times, Yorkshire Post, BBC News

Cue banks making a song and dance about their accounts paying an inflation-beating rate of interest? What was that about lies, damned lies and statistics?

David Whiscombe


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