UK Retail Inflation Report summary
November 2021
Period covered: Period covered: October 2021
1 minute read
Note: This report summary is one or two months behind the current month as standard reporting practice. The content is indicative only and incomplete with certain data undisclosed. Subscribe to access this data or take out a free 30 day subscription trial now.
CPI inflation accelerated to a 10-year high in October rising to 4.2% YoY, from 3.1% last month. This was above economists’ expectations of inflation hitting 3.9%.
More than half of the change in the CPI rate was driven by the housing and household services component (+0.66 percentage points, pp). This was predominantly driven by the increase in the energy price cap on 1 October following record rises in energy prices after economies emerged from national lockdowns. Electricity and gas prices accelerated by 8.7% and 17.1% respectively on the previous month.
Transport (+0.21pp) also made a large upward contribution driven by motor fuels and second-hand cars. Average petrol prices were 138.6 pence per litre in October 2021 – the sharpest price rise since September 2012 as the sharp uptick in oil prices filtered through to the pumps. Second-hand car prices rose by 0.00% during October and have accelerated by 27.4% since April 2021, reflecting supply disruptions of semiconductor chips.
Cost pressures for retailers continue to build in the supply chain with input producer prices rising by 0.00% YoY in October – 13-year high. Resultantly, inflation edged higher at the factory gate (output prices) by 8.0% YoY, although clearly companies continue to absorb some of these pressures to ease the burden on consumers.
Consumer anxiety remains elevated, with 0.00 worried about the rising cost of living (Retail Economics Consumer Panel, November 2021), broadly unchanged from the previous month.
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Consumer Price Index vs Core Inflation
Source: ONS