Consumer price inflation, UK: May 2019

Price indices, percentage changes and weights for the different measures of consumer price inflation.

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This is an accredited national statistic.

Contact:
Email Philip Gooding

Release date:
19 June 2019

Next release:
17 July 2019

1. Main points

  • The Consumer Prices Index including owner occupiers’ housing costs (CPIH) 12-month inflation rate was 1.9% in May 2019, down from 2.0% in April 2019.

  • Falling fares for transport services, particularly air fares influenced by the timing of Easter in April, and falling car prices produced the largest downward contributions to the change in the rate between April and May 2019.

  • Partially offsetting upward contributions came from rising prices for a range of games, toys and hobbies, furniture and furnishings, and accommodation services.

  • The Consumer Prices Index (CPI) 12-month rate was 2.0% in May 2019, down from 2.1% in April 2019.

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2. Analysis of consumer price inflation

CPIH 12-month inflation rate

The Consumer Prices Index including owner occupiers’ housing costs (CPIH) 12-month rate was 1.9% in May 2019, down from 2.0% in April 2019.

The Consumer Prices Index (CPI) 12-month rate was 2.0% in May 2019, down from 2.1% in April 2019.

Table 1 presents the index numbers and inflation rates for CPIH, CPI and the owner occupiers’ housing costs (OOH) component of CPIH.

Figure 1 compares the 12-month inflation rates for CPIH, CPI and the OOH component of CPIH. Given that OOH accounts for around 17% of CPIH, it is the main driver for differences between the CPIH and CPI inflation rates.

Contributions to CPIH 12-month inflation rate

Figure 2 shows the extent to which the different categories of goods and services have contributed to the overall CPIH 12-month rate over the last two years.

The largest upward contribution to the CPIH 12-month rate in May 2019 came from housing and household services, with prices rising by 2.3% on the year. The 12-month rate for this broad group was last higher in August 2013 when it was 2.4%. Within the group (which contributed 0.68 percentage points to the overall rate), the largest contributions were from electricity, gas and other fuels (a 0.28 percentage point contribution) and owner occupiers’ housing costs (a 0.20 percentage point contribution).

There was also a large upward contribution from transport, where prices rose by 2.7% on the year, down from 4.6% in April 2019, which was influenced by the timing of Easter. The 12-month rate for May 2019 was the lowest observed since April 2018. Within transport, the most notable contributions were from motor fuels and new cars.

Clothing and footwear was the only broad group producing a downward contribution in May 2019, reflecting a fall in prices of 1.6% on the year. The contribution from this category has been negative for nine months.

Contributions to change in CPIH 12-month inflation rate

Figure 3 shows how each of the main groups of goods and services contributed to the change in the Consumer Prices Index including owner occupiers’ housing costs (CPIH) 12-month rate between April and May 2019. The corresponding figures for the Consumer Prices Index (CPI) can be found in column F of Table 26 in the Consumer price inflation dataset.

By far the largest downward contribution to the change in the CPIH 12-month rate came from transport, where prices fell by 0.3% between April and May this year compared with a 1.5% rise between the same two months a year ago. The main downward effect came from transport services: fares fell by 3.8% overall between April and May this year, with the April prices influenced by Easter and the associated school holidays falling in the middle of the month. In 2018, when Easter fell in early April before the price collection dates, fares rose between April and May by 2.0%. The contribution from transport services came from all categories – air, sea, rail and road – with the single largest contribution from air transport.

Within transport overall, there were also smaller downward contributions from the purchase of vehicles (second-hand and new cars) and motor fuels. Petrol prices rose by 4.2 pence per litre between April and May 2019 compared with a larger rise of 4.6 pence per litre a year ago. They now stand on average at 128.3 pence per litre. Similarly, diesel prices rose by 2.8 pence per litre this year to stand at 135.8 pence per litre, compared with a rise of 4.7 pence per litre a year ago.

A smaller downward contribution came from alcoholic beverages and tobacco, with prices of cigarettes little changed this year but rising a year earlier.

The largest upward contribution to the change in the CPIH 12-month rate came from recreation and culture, where prices rose by 0.5% between April and May 2019 compared with a smaller rise of 0.1% between the same two months of 2018. Within this group, the largest upward effect came from games, toys and hobbies, partially from computer games but also from more traditional toys and games. Price movements for computer games can often be relatively large depending on the composition of bestseller charts. Within recreation and culture, there was a small, partially offsetting, downward effect from package holidays, which fell in price this year but rose in 2018.

Restaurants and hotels also produced an upward contribution, with prices for accommodation services, particularly overnight hotel accommodation, rising by more than a year ago.

Further small upward contributions came from food and non-alcoholic beverages, where prices rose this year but fell a year ago (particularly for meat), and furniture, household equipment and maintenance, where prices rose this year by more than a year ago, with the main upward contribution coming from furniture and furnishings.  

Owner occupiers’ housing costs

Figure 4 shows the contribution of owner occupiers’ housing costs (OOH) and Council Tax to the Consumer Prices Index including owner occupiers’ housing costs (CPIH) inflation rate in the context of wider housing-related costs. The contribution from OOH had been on a downward trend from a high in October 2016. However, it has stabilised over the latest 12 months and was the largest contribution to the CPIH 12-month rate from all the housing and household services categories for the first three months of 2019.

Utility bills made a negative contribution during 2015 and 2016 but subsequent rises, most notably in electricity prices, saw the contribution turn positive through 2017 into 2018. Further electricity and gas price rises in autumn 2018 increased their contribution to the CPIH 12-month rate. The introduction of Ofgem’s initial energy price cap resulted in reduced contributions to the CPIH 12-month rate for January to March 2019. However, the contribution from electricity, gas and other fuels increased in April 2019 as energy providers responded to the latest change in the price cap.

Increases in Council Tax starting in 2016 mean that its contribution has risen over recent years, though there was little change in the contribution when the 2019 increases were introduced in April this year. Conversely, the reduction in the contribution from rents is likely to be a result of a policy to reduce social housing rent starting from April 2016, although the contribution has risen slightly over the last year. Other housing costs (namely regular maintenance and repair, along with water and sewerage services) tend to make small contributions to the 12-month rate.

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3. Consumer price inflation data

Consumer price inflation tables
Dataset |Released on 19 June 2019

Measures of monthly UK inflation data including Consumer Prices Index including owner occupiers’ housing costs (CPIH), Consumer Prices Index (CPI) and Retail Prices Index (RPI). These tables complement the consumer price inflation time series dataset.

Consumer price inflation time series
Dataset | Dataset ID: MM23 | Released on 19 June 2019

Comprehensive database of time series covering measures of inflation data for the UK including CPIH, CPI and RPI.

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4. Glossary

Consumer price inflation

Consumer price inflation is the rate at which the prices of goods and services bought by households rise or fall. It is estimated by using price indices. Consumer price indices – a brief guide gives an overview of the indices and their uses.

12-month inflation rate

The most common approach to measuring inflation is the 12-month inflation rate, which compares prices for the latest month with the same month a year ago. In any given month, the 12-month rate is determined by the balance between upward and downward price movements of the range of goods and services included in the index.

Consumer Prices Index including owner occupiers’ housing costs (CPIH)

CPIH is the most comprehensive measure of inflation. It extends the Consumer Prices Index (CPI) to include a measure of the costs associated with owning, maintaining and living in one’s own home, known as owner occupiers’ housing costs (OOH), along with Council Tax. Both of these are significant expenses for many households and are not included in the CPI.

Consumer Prices Index (CPI)

CPI is a measure of consumer price inflation produced to international standards and in line with European regulations. First published in 1997 as the Harmonised Index of Consumer Prices (HICP), the CPI is the inflation measure used in the government’s target for inflation.

CPI is produced at the same level of detail as CPIH, in the accompanying dataset and time series.

Retail Prices Index (RPI)

RPI does not meet the required standard for designation as a National Statistic. In recognition that it continues to be widely used in contracts, we continue to publish the RPI, its subcomponents and RPIX. To view the all-items RPI and 12-month inflation rate and an at-a-glance comparison with other measures, please see the time series section of the inflation and price indices area of our website.

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5. Measuring the data

The consumer price indices are based on prices collected from outlets around the country, supplemented by information collected centrally over the internet and by phone.

Consumer price indices, a brief guide gives an overview of consumer price statistics.

The Consumer Price Indices Technical Manual covers the concepts and methodologies underpinning the indices in more detail.

The CPIH Compendium provides a comprehensive source of information on the Consumer Prices Index including owner occupiers’ housing costs (CPIH), with a focus on the approach to measuring owner occupiers’ housing costs (OOH).

The Consumer Price Inflation Quality and Methodology Information report contains important information on:

  • the strengths and limitations of the data and how it compares with related data

  • users and uses of the data

  • how the output was created

  • the quality of the output including the accuracy of the data

The figures in this publication use data collected on or around 14 May 2019.

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6. Strengths and limitations

We have illustrated our future approach to measuring changing prices and costs faced by consumers and households using three “use cases”, along with how they relate to the measures that we currently publish and those that are under development. Specifically, they refer to the CPIH as our lead measure of inflation based on economic principles; the Household Costs Indices as a set of measures to reflect the change in costs as experienced by households; and the Retail Prices Index (RPI) as a legacy measure that is required to meet existing user needs. Shortcomings of the Retail Prices Index as a measure of inflation, released on 8 March 2018, describes the issues with the RPI.

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7. More about consumer price inflation

Correspondence with the Bank of England about pre-release access

Exchange of letters requesting exceptional pre-release access so that data are available for discussion at the Monetary Policy Committee (MPC). The Bank of England were granted exceptional pre-release access to an estimate of the Consumer Prices Index (CPI) at 8:30am on Friday 14 June 2019 so that the data were available for the MPC meeting held on that day.

Consumer price inflation detailed briefing note
Article | Released 19 June 2019

Background briefing to the statistical bulletin.

Users and uses of consumer price inflation statistics
Article | Released 25 July 2018

Information about the users and uses of consumer price inflation statistics and user experiences of these statistics. Additionally, information on the characteristics of the different measures of consumer price inflation in relation to potential use.

Consumer price inflation, updating weights
Article | Released 18 March 2019

An overview of the latest annual update of the relative weights of items used in compiling the UK consumer price inflation indices.

Consumer price inflation basket of goods and services: 2019
Article | Released 11 March 2019

The review process for the items making up the inflation basket used to calculate the UK consumer price inflation indices and the changes in the latest year.

Explaining the contribution to change in the 12-month rate
Infographic | Released 2013

An explanation of how the various types of goods and services contribute to the change in the 12-month inflation rate between the latest two months. The size and direction of these contributions depends on how prices changed between both the latest two months this year and the same two months last year. For example, the price of a product could make an upward contribution to the change in the rate even if it fell, provided that it fell by less than it did between the same two months a year ago.

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8. You might also be interested in

Producer price inflation, UK
Bulletin | Released 19 June 2019

Changes in the prices of goods bought and sold by UK manufacturers including price indices of materials and fuels purchased (input prices) and factory gate prices (output prices).

UK House Price index
Bulletin | Released 19 June 2019

Monthly house price inflation in the UK, calculated using data from HM Land Registry, Registers of Scotland and Land and Property Services Northern Ireland.

Index of Private Housing Rental Prices
Bulletin | Released 19 June 2019

An experimental price index tracking the prices paid for renting property from private landlords in the UK.

Prices economic commentary
Article | Released 19 June 2019

Presents further analysis of producer prices, house prices and rental prices in addition to the Consumer Prices Index including owner occupiers’ housing costs (CPIH).

Advisory panels for Consumer Price Statistics

Reports, papers and minutes of the two independent advisory panels on consumer price statistics: a technical panel to advise the National Statistician on technical aspects of the statistics; and a stakeholder panel to provide advice on the uses and applications of price indices.

Consumer price inflation item indices and price quotes
Dataset | Released 19 June 2019

The individual price quotes (for locally-collected items only) and item indices that underpin the consumer price statistics.

Harmonised Index of Consumer Prices
Dataset | Released 18 June 2019

The Harmonised Index of Consumer Prices (HICP) provides a comparable measure of inflation for each member state of the EU. The UK HICP is identical to the UK Consumer Prices Index (CPI). Further information is available on the Eurostat website.

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Contact details for this Statistical bulletin

Philip Gooding
cpi@ons.gov.uk
Telephone: Consumer Price Inflation Enquiries: +44 (0)1633 456900. Consumer Price Inflation recorded message (available after 9.45am on release day): + 44 (0)800 0113703