The prices of goods leaving factory gates in Britain were unchanged in July, official data showed today, highlighting the absence of inflationary pressures.
But the British Office for National Statistics reported output producer prices nudged up by 0.3 per cent compared with a year ago, their highest since June last year, caused mainly by base effects.
Output prices were broadly in line with expectations and were unlikely to ruffle any feathers at the inflation-wary central bank, the Bank of England.
Productivity among British firms also continued to grow strongly in July, particularly in the dominant service sector, a key survey showed today.
The Lloyds TSB/Institute of Management Services productivity index remained steady at 56.3 last month and only just below the 56.4 recorded in May, which was the strongest for two-and-a-half years. A score above 50 indicates expansion; below 50 a contraction.
Britain's economy bounced back in the second quarter from near-stagnation around the turn of the year, but recent stock market weakness has cast doubt over whether that recovery can continue.