**As seen in Risk In The Week report 04/14/24, subscribe at cablefxm.co.uk/reports
U.K. headline CPI slowed to rise by 3.4% Y/y, this was 1/10 of a percent lower than the consensus forecast. The core reading rose by 4.5% Y/y, the metric came in below expectations and slower than the prior, inflation excluding food and energy is now at the lowest level since the start of the Russia-Ukraine war. The closely followed service CPI eased to 6.1% Y/y from the prior 6.5%, the slowdown confirmed a broad cooldown in price readings. Goods prices rose by 1.1% Y/y, the slowest pace in more than two years. Food prices ticked lower to 6.7% Y/y from 8.3%, this was translated to almost 1/2 of a percent contribution to the February headline. Transport prices posted the fourth consecutive negative contribution to the CPI.
Economists at ING headline and core rising at 3.1% and 4.1%, respectively, they reminded us that the BoE will be focusing on price and wage data to decide on the timing of the Bank Rate cut. ING's view is that May is too early for the BoE to decide on a move, irrespective of this week's data, but they warned that a sizable downside surprise could push the central bank to use the meeting to signal a June rate cut.
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