Analysts at HSBC Bank offer a sneak peek at what to expect from Wednesday’s UK CPI release due at 0930 GMT.
“Inflation surprised to the downside in September, with the headline CPI rate dropping from 2.7% to 2.4% y-o-y. The inflationary effect of the 2016 sterling depreciation continues to wane, perhaps a little more quickly than we might have thought. And despite recent gains in wage growth, domestically generated inflation (services inflation, for example) remains low.
We expect the CPI rate to hold steady in October. Despite recent falls in the oil price, petrol pump prices held up in October such that the annual rate of fuel inflation is likely to edge up. But at the same time, we think the continued waning of FX effects will see the core CPI rate edge down from 1.9% to 1.8% y-o-y.”