United Kingdom: Inflation continues to rise unabated in May
June 13, 2017
Consumer prices ikn the UK rose 0.3% in May compared to the prior month, down from April’s 0.5% rise. May’s uptick was driven by higher prices for furniture, household equipment and maintenance, housing, water, electricity, gas and other fuels and clothing and footwear.
Inflation increased from 2.7% in April to 2.9% in May, the highest rate since April 2012 and overshooting analysts’ expectations, while annual average inflation increased from 1.3% in April to 1.5% in May. As a result, inflation veered further away from the Bank of England’s 2.0% target. The weaker sterling is driving price rises, as demand-pull inflationary pressures remain subdued despite record-low unemployment, with real wage growth having petered out in recent months.
Author: Oliver Reynolds, Economist