British producer prices jump in January

11th February 2011, Comments 0 comments

The price of goods leaving British factories soared to an eight-month peak in January, propelled by rising costs for food, fuel and chemicals, official data showed Friday.

Producer prices jumped 4.8 percent in January, compared with the same month in 2009, the Office for National Statistics (ONS) said in a statement.

That beat market expectations for a gain of 4.6 percent, according to analysts polled by Dow Jones Newswires.

Prices rose 1.0 percent in January compared with December.

"Month on month, the output prices measure for all manufactured products rose 1.0 percent between December and January, mainly reflecting price rises in petroleum (including duty), food and chemical products," it said.

The data was published one day after Bank of England policymakers voted to keep British interest rates at a record low 0.5 percent, despite ongoing jitters about soaring consumer price inflation (CPI).

"January's producer prices figures provide a timely reminder that, despite (Thursday's) decision to keep rates on hold, the risk of a near-term hike in interest rates remains very much alive," said Capital Economics analyst Samuel Tombs.

"At least these rises are at the very beginning of the inflation pipeline, so they will not feed through to CPI inflation until well into 2012," he added.

© 2011 AFP

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