HSBC economist Chris Hale said in a report that there is little evidence of indirect energy effects in the UK inflation data, which indicates that the Bank of England may keep interest rates unchanged next week and beyond. Driven by automobile fuel prices, the inflation rate in June fell to 2.6% from 2.8% in May, although the core inflation rate stabilized at 2.6%, which was higher than average expectations. He said that the first evidence of indirect energy effects will be in food inflation, which has abated somewhat, and so far there is no evidence of higher wage and price settings. However, he said that for the Bank of England, the rise in oil and gas prices in recent weeks has brought additional upward risks to the inflation outlook.

HSBC economist Chris Hale said in a report that there is little evidence of indirect energy effects in the UK inflation data, which indicates that the Bank of England may keep interest rates unchanged next week and beyond. Driven by automobile fuel prices, the inflation rate in June fell to 2.6% from 2.8% in May, although the core inflation rate stabilized at 2.6%, which was higher than average expectations. He said that the first evidence of indirect energy effects will be in food inflation, which has abated somewhat, and so far there is no evidence of higher wage and price settings. However, he said that for the Bank of England, the rise in oil and gas prices in recent weeks has brought additional upward risks to the inflation outlook.