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UK Has Deflation for First Time Since 1960

Britain’s annual rate of consumer price inflation fell below zero for the first time since the 1960s, official figures showed on Tuesday, pushed down by lower travel costs due to an early Easter.

The Office for National Statistics said consumer prices fell 0.1 percent in April compared with the same month last year.

Economists taking part in a Reuters poll had expected the consumer price index to remain at zero.

It was the first time that the CPI came in negative since official records for the index began in 1996. Based on comparable estimates going back further, it was the first time that consumer prices showed deflation since 1960, the ONS said.

In monthly terms, prices rose 0.2 percent, the ONS said.

Bank of England Governor Mark Carney said last week that the central bank thought inflation could turn negative imminently, although he reiterated that prices would pick up in the coming months and interest rates were more likely to move up than down.

Read more at Reuters

 

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