Q2 Inflation Steady at 0.4%

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Q2 '16 Inflation: 0.4%

Average Prediction: 0.5%

Number of Correct Forecasts: 52/558

Highest Oil Price: $53 (8th Jun)

Competition Progress: 61.5% complete

The second quarter of 2016 followed the same pattern as the first: two months of 0.3% inflation (in April and May), followed by a month of 0.5% (June), pushed up by a combination of price increases in air fares, motor fuels, and recreational goods.  Although we expect the devaluation of the pound to feed through into inflation, it is unlikely this will have a significant effect until later in the year. Overall, this meant the quarterly average was just under 0.4% for the second quarter in a row.

This was just under the average forecast of 0.5% for the second quarter, with 52 out of our 558 forecasters getting it exactly right.  The field was evenly split, with just under 50% (278 out of the 558) of entries predicting that inflation would be 0.5% or higher this quarter.  Almost 10% of forecasters thought inflation would still be zero or negative at this point in the year.

None of our three Titans got this quarter's inflation figure right, although two were close: competition leader Sean Holly (representing Cambridge) predicted 0.5%, while Jonathan Portes (Oxford) went the other way with 0.3%.  LSE's Rain Newton-Smith predicted a rate of 1.2%, putting her into a distant third place overall in the competition, and although Rain can technically still catch the other two up, it now looks like a two horse race.

Click here for a summary of the results so far, or here for the full standings.