In this paper we model monthly UK inflation and find that there is some small but significant autocorrelation …, particularly at 12 months. We find that this autocorrelation in monthly inflation leads to significant persistence in the headline … annual inflation figure. A one-off shock to monthly inflation will have an effect on the headline figure equal to 10% of the …

inflation are co-breaking. We argue that the step-like development of inflation is in line with shocks and monetary policy that …% inflation was accomplished by introducing an inflation targeting regime. …