The consumer price inflation has surprising sustained its current level as the cost of fuel declined despite the indication of household spending has slowly held steady. It maintained the 2.6 percent as seen in the month of July in comparison to the forecast of 2.7 percent by Reuters. However, it has been predicted by the Bank of England the possibility for the inflation to achieve close to 3 percent in October since the four-year high or 2.9 percent in the month of May. According to an ONS statistician, the cost of food, clothes and household merchandise counters the rising fuel prices that kept the inflation unchanged in July. However, a dovish outlook for inflation that lessens the likelihood of a rate hike by the Central bank’s policymakers who are currently hoping for a rate hike. The BoE predicts the CPI to decline in a slow manner and the target will be kept higher than 2 percent target in the next three years considering the decline from the start of the financial crisis where Sterling dropped 10 years ago.
