UK October manufacturers' input costs rose a seasonally adjusted 1.0pc from September, well ahead of forecasts, according to figures released today by National Statistics. On a year-on-year basis, input prices rose 2.0pc from their October 2001 level, again surpassing estimates. The monthly rise was the fastest since March this year while the annual increase was the biggest since June 2001.
According to analysts' forecasts, producer input prices - an indication of pipeline inflation - were expected to have dropped 0.3pc on the month for a 1.5pc year-on-year rise. Analysts have tipped inflation - due tomorrow - to come in at 2.2pc, but this figure is now also likely to be surpassed in light of the unexpectedly high rate of input price growth Between October and September there was a 1.2pc drop in crude oil prices, lopping 0.29 percentage points from the overall input price index. However, despite the latest drop, oil prices were 26.7pc higher on the year.
The core measure of input prices, which excludes oil prices along with the price of food, beverages, and tobacco, was down 0.2pc on the month leaving it 1.5pc down on a year-on-year basis. //www.fxcentre.com