UK input costs slide

British firms' costs fell unexpectedly in July while factory gate inflation met expectations, official data showed on Monday, providing some relief for policymakers eager to see inflation pressures ease.
Financial markets, preoccupied with concerns over liquidity and credit risks, barely reacted to the figures which did little to change forecasts for one more interest rate hike this year. However, Bank of England policymakers may be relieved that inflation pressures are easing further up the pipeline.
The Office for National Statistics said input prices fell 0.5 percent on the month, the weakest reading since January and confounding analysts' forecasts for a 0.7 percent gain. Annual input price inflation eased sharply to stand flat, against expectations for a 1.3 percent rise.
Output prices rose 0.2 percent on the month in July for an annual rate of 2.4 percent. That was broadly in line with analysts' forecasts and came after June's upwardly revised 0.3 percent gain on the month and 2.5 percent annual rise.