“Black Friday” has reduced inflation

The prices in November grew at half the rate than foreseen

Inflation in Britain slowed sharply in November as clothing retailers cut prices for more than a decade, while consumer demand remained uneven amid a coronavirus pandemic.

Consumer prices rose 0.3% year on year, following a 0.7% rise in October, according to the British National Statistics Office (ONS) on Wednesday.

November inflation is half that of economists forecast in a Reuters survey and close to the almost five-year low of 0.2% recorded in August.

For November alone, ONS announced that clothing and footwear prices plunged 2.7% – the biggest drop for the month, partly reflecting Black Friday discounts.

Compared to a year earlier, clothing and footwear prices were 3.6% lower, the largest annual decline since January 2010.

However, with investors focusing on discussions between Britain and the European Union before the end of the Brexit transition period on 31 December, reactions to the data have been limited.

The central bank will announce its decision on interest rates on Thursday and is likely to refer to weak inflation, which is well below the 2% target, as well as recent forecasts.

Property prices, however, continued to rise significantly, with ONS announcing an annual increase of 5.4% for the 12 months to October, the largest increase since October 2016.