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Inflation rises to 1.9% in June 2014

Released: 15 July 2014 Download PDF

CPI Percentage change over 10 years

United Kingdom

CPI Percentage change over 10 years
Source: Office for National Statistics

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The rate of inflation faced by households rose to 1.9% in the year to June 2014, up from 1.5% in May. The latest information continues the trend of below 2.0% inflation during 2014.

Price rises for various clothing and food items and increases in air fares were the main reasons behind the increase in the rate. Clothing prices usually fall between May and June as the summer sales season begins but this year the average prices of a number of products have risen. The main effect came from a wide range of women’s outerwear, particularly items such as trousers and skirts.

Prices of food & non-alcoholic drinks also rose on the month so that they are now little changed on the year to June. This follows May figures which showed food prices had fallen on the year. The monthly rises here came from a variety of product groups, most notably vegetables and bread & cereals.

Air fares rose as usual between May and June 2014 but in 2013 they fell overall. The movements were driven by changes in fares on European routes.

To understand how inflation impacts on households it is worth looking past the monthly movements to focus on the sectors that contribute to the rate of inflation ie what makes up 1.9%, not what made inflation change from 1.5% to 1.9%. The former don’t change much from month to month but have the biggest impact on households. Prices in the housing, water, electricity, gas & other fuels sector continue to have the largest upward effect on inflation, contributing around a quarter of the total. On the other hand, motor fuels currently have a downward pull on inflation. Average petrol prices were around £1.30 in June this year compared with £1.34 a year earlier.

CPIH, the measure of household inflation which includes the costs faced by owner occupiers, grew by 1.8% in the year to June, up from 1.4% in May.

Source: Office for National Statistics

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