CPIH running closely at 9.2% during the same period

Inflation rose to 10.4 per cent in England last month, based on the latest consumer price index (CPI) from the Office of National Statistics (ONS).

At the same time, the consumer price index including owner occupiers’ housing costs (CPIH) rose by 9.2 per cent.

The CPIH & CPI in January 2023 were 8.8 per cent and 10.1 per cent, respectively.

The ONS reports that the “CPIH rose by 9.2 per cent in the 12 months to February 2023, up from 8.8 per cent in January but below a recent peak of 9.6 per cent in October 2022. Indicative modelled consumer price inflation estimates suggest that the October 2022 rate was the highest rate in over 40 years”.

Rising CPIH and CPI monthly

Since October 2022, the CPIH annual rate has fluctuated around 9.2 per cent, a rate that was previously recorded just over 30 years ago, between September and December 1990.

However, since February 2023, the largest upward contributions to the annual CPIH inflation rate came from increases in the divisions ‘housing and household services’ (principally from increases in electricity, gas, and other fuels) and increases in food and non-alcoholic beverages.

On a monthly basis, CPIH rose by 1.0 per cent in February 2023, up from 0.7 per cent February 2022. The largest upward contributions to the monthly change in both the CPIH and CPI rates came from restaurants and cafes, food, and clothing.

This was partially offset by downward contributions from recreational and cultural goods and services (particularly recording media), and motor fuels. On a monthly basis, CPI rose by 1.1 per cent in February 2023, in comparison to a 0.8 per cent rise in February 2022.

According to the ONS, “the main drivers of the annual inflation rate for CPIH and CPI are the same where they are common to both measures. However, the owner occupiers’ housing costs component accounts for around 16 per cent of the CPIH and is the main driver for differences between the CPIH and CPI inflation rates. This makes CPIH our most comprehensive measure of inflation”.

The CPIH all goods index rose by 13.4 per cent in February 2023, up slightly from 13.3 per cent in January 2023. The rise in the rate stemmed from an upward contribution to the change from food, alcoholic beverages, and tobacco.

LARGEST UPWARD CONTRIBUTION TO RATE CHANGE

This has been largely offset by a downward contribution from industrial goods, with overall energy prices rising by 48.3 per cent in the year to February 2023, down from 50.7 per cent in the year to January, principally caused by movements in motor fuel prices. The CPIH all services index rose by 5.6 per cent in February 2023, up from 5.2 per cent in January 2023.

The largest upward contribution to the change in the rate between January and February 2023 was from recreational and personal services (almost entirely from catering services), with the annual inflation rate rising from 9.4 per cent to 10.4 per cent between January and February 2023. There were smaller upward contributions from travel and transport services, and communication.