UK inflation dips less than expected in May
British inflation eased less than expected in May after surging in April, official data showed Wednesday, fuelling expectations that the Bank of England will hold interest rates steady this week.
The Consumer Prices Index dipped to 3.4 percent last month compared with a rate of 3.5 percent in April, the Office for National Statistics (ONS) said in a statement. Analysts consensus forcecast had been for a drop to 3.3 percent.
The Bank of England (BoE) was widely expected to keep its key interest rate at 4.25 percent in a decision due Thursday after annual inflation hit a 15-month high in April on soaring utility bills.
"A variety of counteracting price movements meant inflation was little changed in May," noted Richard Heys, acting chief economist at the ONS.
"Air fares fell this month, compared with a large rise at the same time last year," he said, adding that rising chocolate and meat prices helped to offset falling motor fuel costs.
Responding to the latest data, finance minister Rachel Reeves said the Labour government's "number one mission is to put more money in the pockets of working people".
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