Also, it could be that the recent sharp moves in the exchange rate are seen to be excessive and a sign of overshooting. However, the longer these weaker levels persist, the greater the risk that the relatively benign impact on inflation will end. Some prices are also impacted far quicker than others: for example petrol prices where the pass-through is very quick.
We have been fortunate that the impact on petrol prices has been moderated to some extent by the weaker international oil price. Nevertheless, should current levels of both product prices and the exchange rate persist, we can expect a sizeable increase in the petrol price in July.