This easing in the annual rate of inflation mainly reflected the slower growth in energy prices, which increased by 1.8% in the year to January, down from 2.9% in the year to December.
OECD area annual inflation was 1.9% in the year to December 2012, unchanged from the annual rate in the year to November 2012. Annual inflation rates for all major components of the CPI were also broadly stable with energy price inflation at 2.9% and food price inflation at 2.1%.
Annual inflation in the OECD area rose by 1.9% in the year to November 2012, compared with 2.2% in the year to October 2012. This easing in the annual rate of inflation mainly reflected slower growth in energy prices, which increased by 2.9% in November, down from 5.4% in October.
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Producer Price Indices (PPIs) serve two main functions. The first is to provide an indication of price change by producers of goods and services, and therefore as an indicator of inflationary pressure on consumer price indices, (CPIs). Increasingly, given the increased tendency of global production processes, they can also serve as indicators of inflationary pressures in importing countries. The second reflects their role in