LONDON, Aug. 15 (Xinhua) -- British inflation slipped upwards to 2.5 percent in July, a whole 50 basis points above the Bank of England's (BoE) target.
The Consumer Prices Index (CPI) rose to 2.5 percent, up from 2.4 percent in June, according to figures released on Wednesday by the Office of National Statistics (ONS).
The reading was in line with consensus expectations, but below the 2.6 percent level expected by the BoE.
Inflation had been on a consistent downward trend since November, when CPI inflation stood at 3.1 percent.
Despite the rise in inflation, the underlying data revealed a confused picture, with strong upward pressure seen in the fuel category, reflecting rising global oil prices.
However, as in June, clothing and footwear prices fell more sharply than in the same month a year ago.
Underlying inflation gauges point to a continuing weakening in inflation pressures, although a 0.5 percent rise over the month in producer price inflation (PPI) input prices took the yearly PPI rate rise to 10.9 percent.
At the beginning of this month, the BoE raised the bank rate 25 basis points to 0.75 percent, only the second rate rise since before the financial crisis in 2007.
"Inflation should resume a modest downward trend towards the end of the year, helped by favorable base effects as the impact on import prices of sterling's sharp drop after the Brexit referendum continues to unwind, although this may be limited by sterling's current renewed weakness," Howard Archer, chief economic adviser to the EY ITEM Club, an economic forecasting group, told Xinhua.
Domestic inflation pressures are expected to pick up modestly over the coming months, he said.
"Firms remain keen to limit their total costs in a challenging and uncertain environment. Fragile consumer confidence will likely deter workers from pushing hard for increased pay rises despite recent higher inflation and a tight labor market," said Archer.
Inflation was likely to fall to 2.3 percent by the end of 2018 and to to 2.0 percent by mid-2019, he added.
