British consumer price inflation stable at 2% in June, pound sterling rises

July 17 (UPI) -- The annual British Consumer Price Index inflation rate held steady in June at 2%, according to the Office of National Statistics.

Measured on a monthly basis , June 2024 CPI inflation rose 0.1%, the same as the June 2023 rate.

Annual CPIH housing inflation including owner-occupied housing rose by 2.8% in June, also the same rate as June 2023.

"The largest upward contribution to the monthly change in both CPIH and CPI annual rates came from restaurants and hotels, where prices of hotels rose more than a year ago; the largest downward contribution came from clothing and footwear, with prices of garments falling this year having risen a year ago," the ONS said in a statement.

ONS Chief Economist Grant Fitzner said on X that hotel prices "rose strongly while second-hand car costs fell but by less than this time last year."

He added that the used car prices were offset by falling clothes prices.

The British core CPI -- excluding energy, food, alcohol and tobacco -- rose by 3.5% for the 12 months to June 2024, the same as the May rate.

The annual core CPIH rate rose by 4.2% in June.

The British pound rose to its highest level against the U.S. dollar since July 19, 2023 Wednesday, climbing 0.5% to $1.303.

The currency strengthening was seen as by economic analysts as being supported by both strong financial data including stabilizing inflation and new political stability with the Labor Party elections victory.

"This morning's steady inflation data at 2% coming in just higher than expectations, may only serve to slightly reduce the chance of an August cut, and perhaps underpin the recent sterling strength ," said Argentex Foreign Exchange analysis head Joe Tuckey.

In emailed comments to CNBC, Rabobank head of Foreign Exchange strategy Jane Foley said sterling "is beginning to get back on its feet, and there is a lot of optimism, I think right now, that perhaps with more stable politics that we can begin to get a better tone in terms of investment."