Investing.com - Consumer price inflation in the U.K. held steady in August, defying expectations of a small rise, official data showed on Tuesday.
The U.K. Office for National Statistics said the rate of consumer price inflation came in at a seasonally adjusted 0.6% last month, unchanged from July. Analyst had expected consumer prices to rise 0.7% in August.
Month-over-month, consumer price inflation accelerated 0.3%, compared to estimates for a gain of 0.4% and following a decline of 0.1% in July.
Bank of England Governor Mark Carney will now have to write an open letter to the Chancellor of the Exchequer, Philip Hammond, as inflation is more than a percentage point below the central bank's target of 2.0%.
Core CPI, which excludes food, energy, alcohol, and tobacco costs rose at a seasonally adjusted rate of 1.3% last month, unchanged from July and compared to forecasts for a reading of 1.4%.
The retail price index increased 1.8% in August, in line with expectations and down from 1.9% a month earlier.
The data also showed that the house price index rose 8.3%, slowing from an increase of 9.7% in July.
GBP/USD was trading at 1.3311 from around 1.3321 ahead of the release of the data, while EUR/GBP was at 0.8437 from 0.8431 earlier.
Meanwhile, European stock markets were mixed. London’s FTSE 100 shed 0.15%, the EURO STOXX 50 tacked on 0.1%, France's CAC 40 inched up 0.1%, while Germany's DAX dropped 0.1%.