UK inflation is on the rise - Rabobank

Philip Marey, Senior US Strategist at Rabobank, suggests that in the UK inflation is on the rise as the headline CPI rose to 0.5% year-on-year in June from 0.3% in May.

Key Quotes                               

“The core measure rose to 1.4% from 1.2%. The headline RPI moved in the same direction, to 1.6% from 1.4%. These inflation figures beat market expectations. One could argue that the Bank of England will be reluctant to cut rates if inflation rises, but inflationary pressure is likely to be fuelled by cost push factors (due to a weaker currency) rather than growing demand. Therefore, the BoE is still on course to ease monetary policy in the coming months to support the economy.”