Gold bars to be exempt from tariffs, White House clarifies
Investing.com - U.K. inflation rose more than expected in June, according to data released earlier Wednesday, providing a headache for Bank of England policymakers as they attempt to guide the U.K. economy through tricky waters. .
Annual consumer price inflation rose 3.6% in June, above May’s 3.4% release, and still ahead of the U.K. central bank’s 2.0% medium-term target.
The monthly rate rose 0.3%, with both figures in line with analysts’ expectations of 3.4% and 0.2%, respectively.
Core CPI, which excludes volatile energy and food prices, rose 0.4% on a monthly basis and 3.7% annually, climbing from 0.2% and 3.5% respectively in May.
Inflation remains above the Bank of England’s target as the central bankers monitor the ongoing market and economic fallout from the imposition of tariffs by the U.S. government as well as the impact of increased employer costs, such as higher minimum wages and National Insurance payments, and hefty energy bills.
Gross domestic product data for May pointed to a contracting U.K. economy for the second consecutive month.
The Bank of England has repeatedly warned that U.K. inflation could rise as the summer progresses, after core CPI briefly hit its 2% target in May last year.
“Consumer price inflation is expected to remain broadly at current rates throughout the remainder of the year before falling back towards target next year,” the June MPC meeting notes said.
“Given the outlook, and continued disinflation, a gradual and careful approach to the further withdrawal of monetary policy restraint remains appropriate. Monetary policy is not on a pre-set path.”
The U.K. central bank held its main interest rate unchanged at 4.25% in June, with its Monetary Policy Committee—responsible for setting UK interest rates—next meeting on Aug. 6.