The Office for National Statistics reported annual Consumer Prices Index inflation of 7.9% in June 2023, down from 8.7% in May. The release was published on 19 July 2023. It described a slower increase in the overall price level, not a return of prices to where they had been before the inflation surge.
The distinction is important for anyone reading an archived property-market reaction. Households could experience continuing cost pressure even while the annual inflation rate fell. Slower inflation and falling prices are different outcomes, and a national index does not reproduce the spending pattern of every household.
Three measures, three definitions
The ONS bulletin also reported CPIH, which includes owner-occupiers’ housing costs. Its annual rate was 7.3% in June, down from 7.9% in May. Core CPI, excluding energy, food, alcohol and tobacco, was 6.9%, compared with 7.1% a month earlier. These figures describe different baskets and should not be exchanged within the same comparison.
For monthly movement, CPI rose by 0.1% in June 2023, compared with 0.8% in June 2022. The bulletin identified motor fuels as an important downward contribution to the change in the annual rates. Food prices were still rising, although more slowly than a year earlier.
The annual comparison therefore depended both on what happened during the latest month and on the month leaving the twelve-month calculation. A reduced annual rate should be read alongside that comparison period, rather than assumed to show a fall in every price category.
What this meant for a property discussion
Our interpretation is that inflation data can inform a discussion about household budgets and financing conditions, but cannot alone establish what a particular home is worth or what mortgage rate a borrower will receive. Those questions require additional evidence and different measurements.
When comparing archived headlines, keep the index name, reference month and release date together. Distinguish a published statistic from a commentator’s prediction about the next interest-rate meeting or the direction of property prices. This article records the June 2023 data; it does not repeat the source archive’s market forecasts as current expectations.