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KPMG comments on latest inflation data

KPMG comments on latest inflation data

“Weaker inflation should give BoE margin to pause while it rings potential alarm bells for the health of the economy”, says Yael Selfin, Chief Economist at KPMG UK.

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“Weaker inflation should give BoE margin to pause while it rings potential alarm bells for the health of the economy”, says Yael Selfin, Chief Economist at KPMG UK.

“Assuming no major exchange rate movements, which a no-deal Brexit could affect, inflation is expected to end the year below the Bank of England’s 2% target, which provides no impetus for the MPC to raise rates this year.

“The falling inflation rate could be an early signal of a cooling economy, in line with what we have seen in the US and the Euro Area, with the rate of price inflation falling across both goods from 1.7% to 1.3% and services, from 2.5% to 2.2%, showing the wide-ranging effects of the slowdown.  

“Recent falls in the value of the pound and the spike in oil prices over the weekend should boost the headline rate in the coming months, with higher prices for fuel and for imported goods putting pressure on households’ purchasing power and business margins, and further curtailing demand.”  

 

-ENDS-

 

For media enquiries, please contact:

Gill Carson, Corporate Communications

T: +44 (0) 20 3078 4189

E: gill.carson@kpmg.co.uk

 

KPMG Press Office

T:  +44 (0) 207 694 8773

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About KPMG in the UK

KPMG LLP, a UK limited liability partnership, operates from 22 offices across the UK with approximately 16,300 partners and staff.  The UK firm recorded a revenue of £2.338 billion in the year ended 30 September 2018. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. It operates in 154 countries and has 200,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity.  Each KPMG firm is a legally distinct and separate entity and describes itself as such.

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