The annual rate of inflation in Britain was unchanged last month, but remained well above the Bank of England's target rate, according to figures published this morning. Retail prices excluding mortgage interest payments, the central bank's preferred measure of inflation, rose 0.7pc in April from March and were up 3.0pc year-on-year, National Statistics said. The annual rate is unchanged from March, which was the highest reading since May 1998 and reflected higher energy prices due to increased crude oil costs.
The largest downward contribution to overall inflation in April came from motoring expenditure. Oil and petrol prices were lower, reflecting declines in crude oil prices following the end of the war in Iraq. "Increases in OPEC production led to falling oil and petrol prices this year, in contrast with shortages and large price rises a year ago," National Statistics said. The office also noted declines in the costs of UK and foreign holidays as travel operators cut prices to boost business amid a slump in demand due to the Iraqi war and the outbreak of SARS. The largest upward influence came from housing costs, reflecting an increase in council tax bills. ///www.fxcentre.com