Friday, January 13, 2012
Drop in inflation in the pipeline
Posted by David Smith at 11:00 AM
Category: Thoughts and responses

They call producer price inflation pipeline inflation and the latest figures suggest a fall in inflation is firmly in the pipeline. Output prices of manufactured products fell by 0.2% between November and December, their first drop since June 2010.

Overall, output price inflation fell from 5.4% in November to 4.8% in December, its lowest for a year. Input prices also fell between November and Decemvber, by 0.6%, and the rate fell dramatically, from 13.6% to 8.7%. This offers a good prospect of a significant and sustained fall in consumer price inflation. The Bank of England will be relieved. More here.