UK: inflation stepped up in Dec-20
- Upside news in the UK CPI and RPI inflation rates was concentrated in areas that do not exhibit a substantial payback relationship into Januarys. The resulting step higher is especially pronounced on the RPI where house price growth remains spiked to excess.- Despite the latest rise, underlying pressures appear to remain muted, with the median rate at 1.4% y-o-y not yet breaking the downtrend. Headline rates should fly through this on April base effects but the subsequent peak above 2% is likely to be short-lived.
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