UK September factory gate prices point towards stabilisation
Tue 16 Oct 2012
LONDON (SHARECAST) - Factory gate inflation rose by 0.5 per cent month-on-month (2.5 per cent year-on-year) in September, compared with a year-on-year rise of 2.3 per cent last month, according to the latest data out today from the Office for National Statistics (ONS).
The consensus estimate had been for an increase of 0.3%.
When compared with the previous month the main upward contributions to the price index came from petroleum products, food products and chemical & pharmaceutical products.
Core output prices gained 0.3% versus the previous month (Consensus: 0.1%), while increasing by 1.2% on year ago levels, unchanged versus the previous month’s reading.
Input prices fell by 0.2% between August and September (Consensus: +0.2%), following a spike higher by 1.9% between July and August and below the 0.1% rise foreseen by economists.
The fall in input prices was driven by lower prices for imported equipment and other goods and home produced food, but these falls were offset to some extent by an increase in the price index for fuels, ONS added.
In the year to September 2012 the total input price index fell 1.2%, compared with a rise of 1.1% last month.
Output prices rose by a tenth of a percentage point in September in terms of quarterly rates of change while input prices dropped by 1.0%.
For economists at Barclays Research: “The data show an easing in input prices, after a brief period of acceleration during the summer as a result of movements in oil prices. However, we would point out that inflation for other types of inputs has been fairly subdued, suggesting that, barring any sharp increases in oil prices again, we could see input prices stabilising over the coming months.”