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Pound is retreating after Juncker's comments of disagreement and UK inflation data

2019-09-18 11:18 am | Resource: News | No Views : 49

 Pound is retreating after Juncker's comments of disagreement and UK inflation data

The pound added to losses on Wednesday after outgoing European Commission President Jean-Claude Juncker warned there was a "real" risk of Britain leaving the EU to a deal where there is little time for talks. Meanwhile, data from the British Office for National Statistics (ONS) showed that UK producer prices rose 1.6% in August and inflation fell to 1.7% last month.

UK inflation fell to 1.7% in August

Annual price growth in Britain fell last month below the BoE target and the core reading surprised further downward. Entertainment and culture added the biggest negative contribution, followed by clothing and footwear. Air prices partially offset the impact, as well as food and alcohol. Year-on-year rate fell to 1.7%, the lowest point since December 2016, from 2.1%. The benchmark also lost 0.4 percentage points, reaching 1.5%. It was the weakest time in November 2016.

Consumer prices are still up 0.4% last month alone after coming steady in July. Monetary guardians have a goal of stabilizing prices at 2%. The national CPIH index, which includes housing costs called homeowners, rose 1.7% as of August 2018 versus 2% recorded in July.

UK PPI rose 1.6% in August

The UK's Office for National Statistics said on Wednesday that the main inflation rate for UK factory output was 1.6% in the 12 months to August. This figure represents a decline from July when producer prices rose 1.9% year on year. On a month over month basis, the headline inflation rate was negative at 0.1%, down from a positive 0.4% the previous month.

The largest upward contribution came to the annual production of inflation of transport equipment, whose prices rose 2.8% year on year. On the other hand, crude oil made the largest downward contribution, dropping 0.8% year on year.

Meanwhile, the annual inflation rate of input materials and fuel purchased by producers decreased by 1.7 percentage points on a monthly basis, reaching 0.8%. The decline marks the first time since 2016 that annual inflation has shown negative growth.

Pound Trading
  • The pound fell 0.47% at 1040 CET, trading at 1.24404 against the dollar
  • The euro rose 0.21% compared to the British currency to 0.88780 at 10:38 CET.
  • The yen also rose against the British currency to 134.79 levels.
  • Against the Swiss franc sterling fell to 1.2402 levels.
  •  Against the Australian dollar sterling rose to 1.8226 levels.


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