The Office of National Statistics has released the latest inflation figures for June, and the good news is that the Consumer Prices Index (CPI) has stayed at 2.0%.
The largest upward contribution to inflation came from restaurants and hotels, where hotel prices in particular have increased on a year ago. Taylor Swift’s Eras tour in the UK may have been a factor in this.
The largest downward contribution came from clothing and footwear as the prices of garments have fallen since a year ago.
As ever, attention turns to how this may affect interest rate policy. The Bank of England next meet to discuss this on August 1st.
While it is encouraging that the headline inflation rate has stayed at 2%, there is concern from economists that underlying inflationary pressures, including services inflation, still persist that make a rate cut less likely. According to Bloomberg, the financial markets reduced the likelihood of a rate cut in August to 25% from 50% after news of the unchanged inflation figures broke.
Anecdotally, we are noticing that many clients in the services sector remain under pressure with finding new work, with some of their regular customers looking at ways to cut costs and reduce spend as well. Collecting payments is also an issue for some.
As experienced business advisers we can help you and your business, whether it comes to renegotiating finance, maximising the intelligence you can get from your financial information or providing tax advice that can make sure your tax burden is as low as possible. Why not give us a call and see what we can do for you?
See: https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/consumerpriceinflation/latest
As the UK tax year-end approaches on 5 April, it’s an excellent time for you to review your business finances and explore tax planning opportunities, particularly if you are self-employed. Tax planning can help you to reduce tax liabilities, boost your cash flow and put you in a stronger financial position.
A report released by the Public Accounts Committee (PAC) has further criticised HM Revenue & Custom’s (HMRC) phone service. It found that nearly 44,000 customers were cut off without warning after being put on hold for more than an hour in the first 11 months of last year.
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