Because the Workplace for Nationwide Statistics has reported this morning, inflation fell in June, as anticipated, however the fall stays smaller than anticipated.

Their abstract was:

• The Client Costs Index (CPI) rose by 7.9% within the 12 months to June 2023, down from 8.7% in Could.
• On a month-to-month foundation, CPI rose by 0.1% in June 2023, in contrast with an increase of 0.8% in June 2022.
• Falling costs for motor gas led to the biggest downward contribution to the month-to-month change in CPIH and CPI annual charges, whereas meals costs rose in June 2023 however by lower than in June 2022, additionally resulting in an easing within the charges.
• There have been no massive offsetting upward contributions to the change within the fee.
• Core CPI (excluding vitality, meals, alcohol and tobacco) rose by 6.9% within the 12 months to June 2023, down from 7.1% in Could, which was the highes fee since March 1992; the CPI items annual fee slowed from 9.7% to eight.5%, whereas the CPI companies annual fee eased from 7.4% to 7.2%.

As they observe, most sectors made a contribution to the autumn in inflation or have been stagnant. Transport prices are actually in damaging territory i.e. they’re deflating:

Meals clearly stays problematic. The one attainable blame is Brexit:

What to make of all this?

The Financial institution of England will spotlight this remark:

• On a month-to-month foundation, CPI rose by 0.1% in June 2023, in contrast with an increase of 0.8% in June 2022.

To take action would, nevertheless, be absurd for 3 causes.

Firstly, inflation is an annual and never a month-to-month measure.

Second, 0.1% is inside the vary of statistical error.

Third, yearly the charges are declining.

There can, on this foundation, be no justification for a rise in rates of interest when the Financial institution of England financial coverage committee subsequent meet in early August. There ought to as a substitute be no change, or perhaps a fall in charges as it’s now apparent that the warmth goes out of UK inflation.

However I’m not optimistic: the Financial institution of England doesn’t have a mission to regulate inflation. It thinks it has a mission to keep up excessive rates of interest and any excuse will do for it in pursuit of that objective.