Inflation surprisingly rises as games and other leisure goods get pricier as lockdowns ease
Inflation surprisingly crept up last month as the lockdown began to ease and demand surged for video games, but prices remained close to four year lows.
The annual inflation rate on the consumer price index, which had been at a four-year low of 0.5% in May, was 0.6%.
Financial markets had expected it to fall to 0.4%.
Including homeowners' mortgage costs, it was 0.8% in June, up from 0.7% in May.
Hit by lockdowns and shoppers' fear of return to the shops, inflation has fallen well below the Bank of England's target of 2%. The UK went into the covid crisis with it at 1.8% in January and 1.5% in March.
Food prices fell but games and clothing rose in price, with recreation and culture having the biggest price hikes, sparked by high demand for video games.
"It is possible that prices have been influenced by the coronavirus lockdown changing the timing of demand and the availability of some items, particularly consoles. However, it is equally likely to be a result of the computer games in the bestseller charts. Price movements can often be relatively large depending on the composition of these charts," the Office for National Statistics said.
Data has been difficult to collect for the Office for National Statistics because so many of the goods it uses in its "basket" have been unavailable to check prices on, although that situation is easing as lockdowns are unwound. That situation eased through June, making the figures arguably more accurate.
Low inflation has given the Bank of England and chancellor Rishi Sunak plenty of scope to stimulate the economy through bond buying, tax cuts, restaurant discounts and other measures because there is little prospect of such moves driving inflation too high.
Future rises in prices were likely to be capped, however. Producer prices - the cost of goods as they leave the factory gates - fell 0.8% on the year to June. That was, however, better than the negative 1.2% figure seen in May.
Alongside food, alcohol, tobacco and restaurants were the only categories which fell during June. Clothing and footwear gained the second strongest after recreation and culture.
The cost of gaming and other toys and hobbies rose 1.8% this year compared with a fall of 4.7% a year ago.
