UK's inflation at 13-month low in Apr 2023; CPI at 8.7%

The overall CPI changes for clothing and footwear were 7.2 per cent YoY for March 2023 and 6.8 per cent YoY for April 2023, ONS said in a press release.

The CPI annual inflation rate for housing, water, electricity, gas, and other fuels was 12.3 per cent in April 2023, down from a peak of 26.7 per cent in January 2023 and from a rise of 26.1 per cent in March 2023. This fall is largely because of the upward contribution from the higher April 2022 Office of Gas and Electricity Markets (Ofgem) energy cap dropping out of the annual estimates.

The main driver behind the change was gas, with monthly prices falling by 1.0 per cent between March and April this year, compared with a rise of 66.8 per cent between the same two months a year ago. This was the first time since October 2020 that monthly gas prices fell and meant that gas provided a downward contribution of 0.75 percentage points to the monthly change in CPIH. Electricity also provided a substantial downward contribution with prices falling by 1.1 per cent between March and April this year, compared with a rise of 40.5 per cent between the same two months a year ago. This meant that electricity provided a downward contribution of 0.67 percentage points to the monthly change in CPIH.

Motor fuel fell by 1.3 per cent between March 2023 and April 2023, compared with a 1.9 per cent increase in the equivalent time period last year. Average petrol and diesel prices stood at 145.8 and 162.4 pence per litre, respectively in April 2023, compared with 161.8 and 176.1 pence per litre in April 2022. Petrol prices fell by 1 pence per litre between March and April 2023 compared with a rise of 1.6 pence per litre between the same two months a year ago, after Russia invaded Ukraine in February 2022. Similarly, diesel prices fell by 4.1 pence per litre this year, compared with a rise of 5.6 pence per litre a year ago.

Responding to the latest CPI inflation figures which show headline inflation falling to 8.7 per cent and food inflation falling to 19.0 per cent, Helen Dickinson, chief executive of the British Retail Consortium, said:

“Consumers will welcome the fall in headline inflation, and while food inflation figures remain high, we are starting to see the price of some essentials begin to come down, including milk and butter, as lower commodity and energy prices begin to filter through. Clothing and footwear price inflation also eased for the second month in a row as retailers introduced their spring discounts. However, even as inflation eases consumers should not expect prices to return to their 2021 levels.

ALCHEMPro News Desk (NB)