😎 Summer Sale Exclusive - Up to 50% off AI-powered stock picks by InvestingProCLAIM SALE

UK inflation falls back to Bank of England's target

Published 19/06/2024, 07:34
© Reuters

Investing.com - U.K. inflation fell back to the Bank of England’s target for the first time in nearly three years, data showed earlier Wednesday, raising hopes that the central bank will start cutting interest rates in the near future.

The U.K consumer price index rose by 2.0% on an annual basis in the 12 months to May 2024, as expected, down from 2.3% in April - the slowest increase since July 2021.

On a monthly basis, the CPI rose by 0.3% last month, below the 0.4% forecast, and in line with the previous month’s gain.

The largest downward contribution to the monthly change came from food, with prices falling this year but rising a year ago, according to the Office for National Statistics, while the largest upward contribution came from motor fuels, with prices rising slightly this year but falling a year ago.

Core inflation, which excludes volatile food, energy, alcohol and tobacco prices, fell to 3.5% on an annual basis, from 3.9%, also as expected.

This adds to the wider global disinflation story, after benign U.S. data last week, and follows a sustained period of high inflation in the UK, which peaked at 11.1% in October 2022 - the highest level since 1981.

It comes ahead of the Bank of England's latest decision on interest rates on Thursday, although the central bank is still widely expected to stand pat on rates, for now.

The BoE steadily increased interest rates from December 2021, peaking at 5.25%, as part of efforts to bring down inflation to its target of 2%.


PROMO: Have you heard that we have started our Summer Sale? Do you want to get InvestingPro at a great price? Discover our offers NOW and add an additional 10% discount by using the code UK10. Don't wait another minute to start making your investment profitable and earn with the best stocks on the market!

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.