LONDON (Reuters) – Britain’s consumer price index (CPI) slowed to 6.8% year on year in July, in line with expectations, but core inflation and pressure on services persist, show Office for National Statistics data released Wednesday.
Economists polled by Reuters had forecast inflation at 6.8%, down from 7.9% in June. This rise is a step away from the 41-year high of 11.1% reached in October, but remains well above the 2% target set by the Bank of England (BoE).
The BoE said earlier this month that it expected inflation to fall to 6.8% in July.
Despite this slowdown, Britain continues to post one of the highest inflation rates in Western Europe. Only Iceland and Austria experienced higher inflation in July.
The BoE is closely watching core inflation – which excludes volatile food and energy prices – and service prices.
Core inflation remained at 6.9% in July, unchanged from June, and higher than the Reuters consensus of 6.8%.
Services inflation rose to 7.4% from 7.2% in June.
(Report Andy Bruce and William Schomberg, written by William James, Corentin Chapron, edited by Kate Entringer)
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