Inflation at highest level for nearly a year

The consumer price inflation stood at 9.6 per cent year-on-year in December, up 0.2 percentage points from November, and still above the Central Bank of Nigeria’s upper limit target of nine per cent, the National Bureau of Statistics said yesterday.

The biggest rises were in the east of England.

Alcohol and tobacco prices also fell by 1.3 per cent in December compared with a smaller fall of 0.2 per cent in 2014.

North East: According to the ONS, home values in the North East are still lagging behind 2008 peaks- the only English region to do so. Both the year-on-year and month-on-month figures were an acceleration.

Tradables inflation shrank 1.8% in the quarter, turning around a 0.7% rise in the September period, for a 2.1% annual decline.

House prices for first-time buyers increased at a slightly slower rate than for existing owners.

The inflation figures from the ONS show that food and non-alcoholic drinks dropped by 2.9% year on year in December, which was the biggest fall since March last year.

Excluding petrol, the CPI showed a 0.5 percent increase on year in Q4.

‘A slight increase in inflation to 0.2 per cent is unlikely to stir anyone’s blood, least of all governor of the Bank of England Mark Carney, who will no doubt shortly put his summer 2015 comments about an interest rate rise around “the turn of the year” in the same dustbin as forward guidance, ‘ says Russ Mould, investment director at AJ Bell.

The figures show the average house price was £288,000 in November.

“Overall, we remain of the view that but we do not expect it to accelerate decisively any time soon”.

Prices for tradable goods and services fell 1.8 percent, with the stronger New Zealand dollar lowering prices for petrol and overseas package holidays.

“Gertjan Vlieghe this week became the latest MPC member to dampen expectations of a rate rise in a very “dovish” speech, noting that “the appropriate real interest rate for the economy might be very low for years to come”.

“London is the dynamo of the entire housing market – and the capital is rapidly gathering energy”. A referendum on European Union membership, the potential of an interest rate rise and the situation in China which could be the start of a global slowdown – all these lead us to assume that this market will not run away with itself.

The average price for properties bought by first-time buyers increased by 7.4 per cent over the year to November 2015, up from an increase of 5.9 per cent the previous month. The Help to Buy scheme has always been accused of stoking prices but not supply but its ultimate goal was also to get Britain building more.

“Food prices recorded significant pressures in December”.