UK Inflation Hits Bank of England's 2% Target Ahead of Upcoming Elections

Money | June 19, 2024, 6:43 a.m.

U.K. inflation has dropped to the Bank of England's 2.0% target in May, according to the Office for National Statistics. This crucial economic measure comes just before national elections in July. With a decline from 2.3% in April, the figure aligns with economist predictions. The decrease was mainly driven by falling food prices, while car fuel costs remained a concern. Services inflation, at 5.7%, and core inflation, at 3.5%, also saw decreases in May. Unseasonable weather has affected grocery sales, which rose by 1.0% in the four weeks to June 9th, marking the sixteenth straight month of declining food inflation. Despite the current alignment with the BOE's target, experts warn of possible upward pressure in the second half of the year as the U.K. phases out its energy price cap.