Rate rise remains likely despite surprise inflation fall to 6.7%

Increase had been expected

A further hike from the Bank of England remains likely despite the surprise inflation fall to 6.7%, beating consensus predictions of a rise on the back of higher petrol costs.

Headline CPI fell 0.1 percentage points month-on-month in July, while core CPI, excluding energy, food, alcohol and tobacco, fell 0.7 percentage points to 6.2%. Food inflation remains well above the headline rate but has also fallen, down to 13.6% from las month's 14.9% figure. Eurozone inflation slows to 5.2% in August Chancellor Jeremy Hunt argued the fall demonstrated the government's plan to halve inflation is "working - plain and simple", but noted it remains "too high" and a barrier to sustainably higher growth. While Neil Birrell, CIO at Premier Miton Investors, said the ...