Office for National Statistics (ONS)

UK Inflation Returns to 2% Target in May for First Time Since July 2021

Jun 19, 2024, 07:47 AM

UK inflation has returned to the Bank of England's 2% target for the first time in nearly three years, according to official figures released by the Office for National Statistics (ONS). The Consumer Prices Index (CPI) rose by 2% in the 12 months to May 2024, down from 2.3% in April. This marks a significant reduction from a peak of 11.1% in October 2022 and 8.7% a year ago. The return to target inflation is seen as a positive development for the UK economy, with potential implications for future interest rate decisions by the Bank of England. Chancellor Jeremy Hunt and Prime Minister Rishi Sunak have both highlighted this achievement as evidence that their economic plans are working, especially ahead of elections. However, underlying price pressures remain, particularly in services, which could influence the Bank's decision on interest rates. This is the first time inflation has hit the target since July 2021.