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11 Dec 2014
UK CPI inflation to fall to 1.2% in November - RBS
FXStreet (Barcelona) - Ross Walker, Senior UK Economist at RBS, views disinflation to be the defining theme in the week ahead, anticipating CPI to fall to 1.2% in November.
Key Quotes
“Disinflation will be the defining theme in the week ahead, with CPI inflation forecast to fall to 1.2% in November – matching its post-crisis low – and producer price data showing even more acute deflation (on both input costs and prices at the factory gate). Headline wage inflation is forecast to edge up to 1.2%, a welcome move but one which would leave real-terms pay broadly flat so hardly a game-changer for the monetary policy outlook.”
“CPI inflation is forecast to edge down to 1.2% in November. Lower energy prices will be part of the story in November, but we also expect the theme of broad-based (albeit relatively mild) disinflation to remain in evidence. A larger decline in CPI inflation is expected in December (to 0.8%) and the RBS forecast is for it to then remain below 1.0% throughout H1 2015.”
“Tumbling crude oil prices (we expect an 8% m/m fall in sterling terms) are expected to result in more acute producer input price deflation, which is in turn expected to show up at the factory gate with a further fall in manufacturers' output price inflation to -0.6% y/y in November.”
Key Quotes
“Disinflation will be the defining theme in the week ahead, with CPI inflation forecast to fall to 1.2% in November – matching its post-crisis low – and producer price data showing even more acute deflation (on both input costs and prices at the factory gate). Headline wage inflation is forecast to edge up to 1.2%, a welcome move but one which would leave real-terms pay broadly flat so hardly a game-changer for the monetary policy outlook.”
“CPI inflation is forecast to edge down to 1.2% in November. Lower energy prices will be part of the story in November, but we also expect the theme of broad-based (albeit relatively mild) disinflation to remain in evidence. A larger decline in CPI inflation is expected in December (to 0.8%) and the RBS forecast is for it to then remain below 1.0% throughout H1 2015.”
“Tumbling crude oil prices (we expect an 8% m/m fall in sterling terms) are expected to result in more acute producer input price deflation, which is in turn expected to show up at the factory gate with a further fall in manufacturers' output price inflation to -0.6% y/y in November.”