09/09/11

  • Producer output prices rose 0.1% in August, after rising 0.3% in July
  • Producer input prices fell 1.9% in August, after rising 0.5% in July

Commenting on the producer price figures for August, David Kern, Chief Economist at the British Chambers of Commerce, (BCC), said:

“The latest producer price figures were better than expected, with a slower increase in output prices and a sharp decline in input prices. Although inflationary pressures are strong and are squeezing margins, the lower input prices will be welcomed by businesses and consumers.

“While we still expect consumer price inflation to increase further over the coming months, fears that it will exceed five percent have eased. The new figures will make it easier for the MPC to persevere with low interest rates for longer and increase the QE programme, if necessary. But keeping interest rates low is not enough to stimulate growth. The government must look more closely at policies to boost growth and reinforce efforts to enable businesses to drive the recovery.”

Ends

Notes to editors:

The British Chambers of Commerce (BCC) is the national voice of local business.

The BCC sits at the heart of a powerful nationwide network of Accredited Chambers of Commerce, serving over 100,000 businesses across the UK, which employ over five million people.

Media contacts:

Liz Larvin
Tel: 020 7654 5813 / 07825746812
Email: l.larvin@britishchambers.org.uk

Lisa Morrison
Tel: 020 7654 5812 / 07717682221
Email: l.morrison@britishchambers.org.uk