Bloomberg released a report stating that, despite the inflation slowdown UK economists expected due to the novel coronavirus pandemic, consumer prices saw a surprise uptick of 0.6 percent in June.
While food and energy inflation rates rose by 1.4 percent in the UK, the cost of clothing and games likewise caused an increase in inflation when compared to the same time last year.
The cost of purchasing video games and consoles actually went up last month in the UK, likely due to the increased demand for digital entertainment caused by lockdowns. In contrast, clothing and footwear prices went down by 0.1 percent. But that decrease is not as low as it was last year, thereby resulting in a higher inflation rate overall. Food prices are also lower, a reflection that people are now grocery shopping differently than they were just a few months ago.
Overall, inflation rates have fallen well short of the Bank of England’s target rate of 2 percent. The decreased demand for goods and services in general due to the coronavirus pandemic has economists predicting only a gradual acceleration in prices. UK’s central bank is now expecting the economy to face the worst downturn in three centuries.
