3 Key Inflation-proof stocks to the eye as inflation levels ease

By - Rishika Raina

More on:

Highlights

  • As per ONS, CPI has gone down from 10.1% in July to 9.9% in the 12 months to August 2022.
  • Core prices, which don’t include volatile elements like energy and food, surged from 6.2% to 6.3%.
  • Food prices jumped by 1.5% from July to August, marking the largest increase for the months since 1995.

After skyrocketing to double-digit growth in July, the UK inflation level unexpectedly eased in August. According to the latest figures unveiled by the ONS, the Consumer Prices Index (CPI) has decreased from 10.1% in July to 9.9% in the 12 months to August 2022.

Inflation had not surpassed the 10% mark in over four decades, which created panic across the nation last month. Still, now the inflation rate has eased a bit, invalidating the expectations of economists that the rate would remain steady.

                                                       ©2022 Kalkine Media®

Even though the CPI fell in August, core prices, which don’t include volatile elements like energy and food, surged from 6.2% to 6.3%. This indicates that the economy has strongly embedded price hikes. Rising food cost was the primary driver of inflation last month, while fuel cost was the leading contributor to the downward move.

From July to August, the annual rate for motor fuels dipped from 43.7% to 32.1%. Diesel prices also declined by 11.3p per litre this year. Meanwhile, food prices jumped by 1.5% from July to August, marking the largest increase since 1995. Inflation levels are expected to remain high over winter, further hurting household budgets.

Amid the ongoing cost of living crisis, UK investors can keep an eye on the following inflation-proof stocks offering dividend income and positive returns.

Diversified Energy Company plc (LON: DEC)

The market cap of the oil and gas-making business, Diversified Energy Company plc, stands at £1,113.06 million as of 14 September. The current dividend yield offering of the company yearly stands at a whopping 11.1%. Though its EPS (earning per share) lies in the negative zone, at -0.03, the FTSE 250 company’s annual and YTD (year-to-date) returns lie in the positive territory, at 16.52% and 26.34%, respectively. DEC shares were trading at GBX 131.90, up by 0.84%, at around 11:00 AM (GMT+1) on Wednesday.

Imperial Brands plc (LON: IMB)

The market cap of the UK-based tobacco making group, Imperial Brands plc, stands at £18,504.45 million as of 14 September. The current dividend yield offering of the company yearly stands at 7.2%. Its EPS is in the positive zone, at 3.00. The FTSE 100 company’s returns on an annual and YTD basis also lie in the positive territory, at 24.87% and 18.52%, respectively. IMB shares were trading at GBX 1,920.50, down by 1.36%, at around 11:00 AM (GMT+1) on Wednesday.

ContourGlobal plc (LON: GLO)

The market cap of the global renewable power generation business, ContourGlobal plc, stands at £1,678.49 million as of 14 September. The current dividend yield offering of the company yearly stands at 6.5%. Its EPS is in the positive zone, at 0.02. The FTSE 250 company’s returns on an annual and YTD basis also lie in the positive territory, at 33.22% and 32.81%, respectively. GLO shares were trading at GBX 255.55 at around 11:00 AM (GMT+1) on Wednesday.