UK: CPI to pick up to 2.6% y/y in June - TDS

Analysts at TDS are looking for the UK CPI to pick up to 2.6% y/y in June (mkt 2.6%), a tenth higher than the BoE had forecast in the May IR.

Key Quotes

“But as it comes on the back of rising energy prices, we don't think that the upside surprise will have much impact on the BoE's thinking. For core inflation we look for a steady reading of 2.1% y/y for the third straight month (mkt 2.1%).”

“We've seen growing reports of labour shortages and upward pressure on wages in the UK, which should help to support underlying inflation going forward.”