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MNI DATA BRIEF: UK May CPI Outpaces Forecast; Above BOE Target

LONDON (MNI)

UK consumer prices jumped by an annual rate of 2.1% last month, from 1.5% in April, well ahead of the 1.8% increase forecast by City analysts, the first above-Bank of England target outturn in 21 months, the Office for National Statistics said Wednesday. Motor fuels accounted for 0.1 percentage points of the change in CPI, following a 17.9% annual rise in petrol prices to an average of 127.2 pence per litre from an unusually-low base in 2020.

Clothing and footwear prices added another 0.16 percentage points to rise in inflation, after an abnormally-large period of discounting last year, while recreation and culture added 0.19 percentage points. RPI jumped to 3.3% from 2.9%, the highest rate since October 2018.

Stripping away volatility in energy prices, core CPI also hit the BOE's target, which could provide for spirited discussion at next week's MPC meeting. Core CPI rose to 2.0% from 1.3% in April, far outpacing expectations, reaching its highest level since August of 2018.

MNI London Bureau | +44 203-865-3812 | les.commons@marketnews.com
Bank of EnglandCentral Bank NewsPolicy NewsHomepageCEEMEABank Of England (BOE) Market NewsBriefUKStoryRegion
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MNI London Bureau | +44 203-865-3812 | les.commons@marketnews.com
Bank of EnglandCentral Bank NewsPolicy NewsHomepageCEEMEABank Of England (BOE) Market NewsBriefUKStoryRegion
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