Consumer Prices in the UK Slow Less Than Expected in April

UK inflation slowed less than expected in April, with consumer prices rising by 0.3%, down from a 0.6% rise in March, according to the Office of National Statistics. This marks the smallest increase in the last three months.

By the numbers:

• Year-over-year price growth decelerated to 2.3% in April, down from 3.2% in March. This is the lowest level since July 2021.
• Economists had projected a more significant drop to 2.1%.
• Core price growth, which excludes volatile food and energy prices, also slowed slightly but remains high. Core prices rose 0.7%, with year-over-year growth slowing to 3.9%, down from 4.1% in March, the lowest since October 2021.

Housing Problems: Housing affordability remains an issue in the UK. The rise in rates has pushed home prices down but rents have skyrocketed.

• Average UK private rents increased by 8.9% in the 12 months to April, down from 9.2% in March. This is the lowest level since January.
• Average UK house prices increased by 1.8% to £283,000 in March, up from a 0.2% decline in February. This marks the first positive growth in the last nine months.

Zoom out: The UK’s inflation trends are slightly different than those in the US. While in the US core and the all-items index are only separated by 0.2%. In the UK, the all-items index and core are seeing a 1.6% spread between the two major indices in April.