UK Consumer Price Inflation At 2-year Low

UK consumer prices rose at the slowest pace in two years in January, weaker than economists' forecast.

The consumer price index rose 1.8 percent year-on-year following a 2.1 percent increase in December, figures from the Office for National Statistics showed Wednesday. Economists had expected 2 percent inflation. Headline inflation was the slowest since January 2017, when prices rose at the same pace. Inflation thus fell below the Bank of England's 2 percent target in January. Core inflation was steady at 1.9 percent at the start of the year, in line with economists' expectations.

ONS data also showed that input price inflation eased to 2.9 percent from a revised 3.2 percent. In contrast, economists had expected a faster rate of 3.8 percent. The core input price inflation slowed to 4.6 percent from 4.7 percent. Output price inflation eased to 2.1 percent from a revised 2.4 percent in December, which was slightly slower than the 2.2 percent economists had predicted. The core output price inflation was steady at 2.4 percent in January.

Another report from ONS showed that UK house price inflation slowed to 2.5 percent in December from 2.7 percent in November, in line with economists' expectations. The latest house price growth figure was the lowest since July 2013, when it was 2.3 percent.