The UK's inflation rate rose last month to its highest since September 2013, official figures show.
Inflation now stands at 2.7% - up from 2.3% in March - and above the Bank of England's 2% target."So both have ignored the new measure ( CPIH ) and stuck with the previous CPI in a clear fail for the ONS strategy. Perhaps people are getting more wary of inflation measures that always seem to give a lower reading! Also I think that the message that the new index is based on a type of fantasy economics measure basing housing costs on rents that are never paid got home.Actually I note the BBC still states RPI inflation presumably on the grounds that it is still in wide use. Much wider use than CPIH.Even a past supporter - readers may recall Chris Giles's time on CPAC and his talk at the RSS- seems not longer to be keeping the faith."I have to say. Having the @ONS decide the headline measure is CPIH when no one uses it is just as irritating as I imagined it would be"I do hope the Office for Statistics Regulation is watching all of this...RegardsShaun Richardshttps://notayesmanseconomics.wordpress.com
Air fares again seem to be major factor in the rise, whether the CPI or the CPI-H is the headline figure or not.
I cannot remember hearing anything to do with housing ever impacting the index, even though even the dogs in the street know that housing costs are one of this countries major blights.
A relevant question to ask is to which month the rents in the RE index relate. They are not new rents centred on April 2017 but I understand that they are a mix of the rents from rental contracts over the last 18 months with a VOA reporting lag of another month. If the RE index is centred about 9 months or so in arrears then that would put it not long after the Brexit vote
All speculative, of course, but it could help explain why CPIH annual increase is currently lower than CPI.
One issue is that there isn't a single ONS IPHRP paper but 5 different papers so it is difficult to come to any firm conclusions.
All the best.