British inflation climbs to 0.6% after Brexit vote

Britain’s annual inflation rate edged higher last month, official data showed yesterday, and is set to climb further as a weak pound caused by the Brexit vote raises import prices. The 12-month Consumer Price Index rose by 0.6 percent in July, the Office for National Statistics said in a statement.

CPI had risen by 0.5 percent in the year to June, the ONS added.

“Although the small increase in the rate between June 2016 and July 2016 takes it to the highest seen since November 2014, it is still relatively low in the historic context,” the ONS said in a statement.

“The main contributors to the increase in the rate were rising prices for motor fuels, alcoholic beverages and accommodation services, and a smaller fall in food prices than a year ago,” it added.

Analysts expect British inflation to rise further in the coming months as the pound battles weakness against the dollar and euro.

Sterling slumped to 31-year lows against the dollar after Britain voted on June 23 to exit the European Union (EU) -- and has struggled to recover.

“One of the big questions facing policymakers in the UK at the moment is how quickly, and by how much, the plunge in sterling following the referendum will raise inflation,” ING bank economist James Smith said following yesterday’s data. “For now at least, the effects are fairly minimal.” Scott Corfe, analyst at the Centre for Economics and Business Research, predicted that “the sharp decline in the value of sterling since the Brexit referendum will translate into higher prices for imported goods over the coming months, pushing inflation to above 2.5 percent in the first half of 2017”.

Despite the prospect of higher inflation, the Bank of England has slashed its key interest rate to a recordlow 0.25 percent to combat the prospect of weaker growth caused by Britain’s vote in favour of exiting the EU.

Britain’s departure from the EU could meanwhile be delayed until late 2019 as civil servants struggle with the task while French and German elections threaten to delay the start of exit negotiations, a report said Sunday.

AFP: China leads the world in connecting everyday devices to the Internet, but is creating huge hacking vulnerabilities for itself and others by doing so, renegade American software pioneer John Mcafee warned yesterday.

Hackers had already been able to gain control of devices such as safes and heating controls, and take over the computer systems of automobiles and aeroplanes, he said.

“China is taking the lead in putting intelligence into devices, from refrigerators to smart thermostats, and this is our weakest link in cybersecurity,” he said in Beijing.

“I am hoping that in the short time I am here I can raise a warning flag that we have to take security of these devices even more importantly than our large computers or our smartphones,” he told a conference of Internet security professionals.

“Because there are so many more of these devices, and the more that are connected, then the higher the risk of a potential hack becomes.”

Mcafee, 70, is the colourful founder of an antivirus software company who once fled Belize after police sought to question him in a murder case.

He has since returned to the United States, where he announced he was running for president.

He amassed an estimated US $ 100 million fortune during the early days of the Internet in the 1990s, but lost most of it to bad investments and the financial crisis.

He was living with a 17-yearold girl in Belize when police came looking for him to discuss the killing of his neighbour -- a crime of which he maintains his innocence. He was briefly incarcerated and fled the Central American country.

Mcafee’s at times dire and alarming speech in Beijing came as his new company MGT Capital prepares to launch cybersecurity products later this year.

“Our species has never before faced a threat of this magnitude. And we have not noticed it by and large,” he said.

“You may be thinking I am exaggerating, that I am an alarmist. I am friends with many of the hackers who have the capability to do enormous damage if they so chose.”

Chinese companies such as Xiaomi have been praised for innovation in adding Internet connectivity to a variety of devices including air purifiers and rice cookers, allowing users to switch them on from work or on their way home.

Such connections create serious new weaknesses that could leave users’ networks especially vulnerable to hacking, Mcafee said.

But in a briefing with reporters he also commended Beijing’s protection of its domestic Internet, which is heavily censored and blocks many foreign websites, for its seeming security against the large-scale breaches seen recently in the US.

“You may notice that last year America suffered hundreds of major hacks from all around the world,” he said, and added that he had “heard nothing” of similar hacks on China.

“Now perhaps that’s the government’s control of the press, I don’t know,” he said. “But I do know that within certain industries of China, the awareness of cybersecurity threats is far greater than our awareness in America.”