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FTSE 100 live: Stocks to start in the red again as inflation eases less than expected

Published 22/05/2024, 07:49
© Reuters.  FTSE 100 live: Stocks to start in the red again as inflation eases less than expected
UK100
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Proactive Investors - On the CPI print, ONS chief economist Grant Fitzner said the large fall in annual inflation was led by lower electricity and gas prices due to the reduction in the Ofgem energy price cap.

“Tobacco prices also helped pull down the rate, with no duty changes announced in the budget," he said. "Meanwhile food price inflation saw further falls over the year. These falls were partially offset by a small uptick in petrol prices."

“The prices of goods leaving factories have risen a little over the last year" Fitzer added, with the producer price index up 1.1% in the year to April, up from a revised increase of 0.7%.

"Meanwhile, the prices of raw materials and fuels grew in the last month, though they remain below where they were a year ago," he said, as input prices fell by 1.6% in the year to April, compared to a fall of 2.5% a month earlier.

James Smith, research director at the Resoltion Foundation said: "This is still the biggest fall in getting on for half a century over the past 18 months - but today's numbers will worry the BoE and suggest inflation is proving stickier than expected."

FTSE 100 to start in red as UK CPI disappoints

The FTSE 100 is predicted to start in the red again on Wednesday as new UK inflation figures show prices did not ease as much as expected last month.

London’s blue-chip index was being called 30 points lower ahead of the open, extending losses after finishing down almost eight points at 8,416.45 yesterday.

The UK consumer price index in April was up 0.3% over the month, figures from the Office for National Statistics showed, which was not as big a reduction as the 0.1% monthly figure that economists expected, but less than the 0.6% in March.

This meant the headline annual CPI rate eased to 2.3% from 3.2% in March but not as low as the 2.1% the market expected.

Core CPI, which includes more volatile prices such as on fuel and food, also eased to 3.9% in April from 4.2%, but again not as much as forecast, with economists looking for a figure of 3.6%.

In the corporate results world, there are numbers from National Grid (LON:NG), water company Severn Trent (LON:SVT), retailer Marks & Spencer and proderyty developer British Land out this morning, while many investors around the world will be looking forward to hearing the latest earnings from chipmaker NVIDIA (NASDAQ:NVDA) after the closing bell in New York later.

Read more on Proactive Investors UK

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