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Inflation dropped below the Bank of England target rate last month for the first time since April 2021, the Office for National Statistics said.
Economists say the faster pace of price rises all but rules out an interest rate cut on Thursday. UK inflation rate hits highest level for eight months Skip to main content
UK inflation slowed to 2% in May, falling to the Bank of England’s target for the first time in nearly three years as food price rises eased sharply. Inflation is finally back at 2% in the UK.
Since 1996 the United Kingdom has also tracked a Consumer Price Index (CPI) figure, and in December 2003 its inflation target was changed to one based on the CPI [39] normally set at 2%. [40] Both the CPI and the RPI are published monthly by the Office for National Statistics. Some rates are linked to the CPI, others to the RPI.
The UK was reported to be among the worst affected among the world's advanced economies. In 2021, the UK's inflation was less than that of the US, but high US inflation was not generally experienced as a cost-of-living crisis due to the stimulus cheques that had been distributed to American households. [8]
Uk inflation history inflation hit 24% in 1975 and in 1976 the Sterling crisis occurred, followed by the Winter of Discontent [2]. The traditional measure of inflation in the UK for many years was the Retail Prices Index (RPI), which was first calculated in the early 20th century to evaluate the extent to which workers were affected by price changes during the First World War.
The sharp drop has fueled expectations that the Bank of England, which sets interest rates in order to hit a 2% target, may move to reduce borrowing rates possibly in the first half of 2024.
The Office for National Statistics said the annual rate of inflation, as measured by the consumer price index, was 6.8% in July, its lowest level since February 2022, the month Russia invaded ...