UK Retail Inflation Report summary
May 2024
Period covered: Period covered: April 2024
3 minute read
Note: This report summary is one or two months behind the current month as standard reporting practice. The content is indicative only and incomplete with certain data undisclosed. Become a member to access this data or take out a free 30 day membership trial now.
Inflation
The headline Consumer Price Index (CPI) rose by xx% YoY in April, down from xx% last month. The annual core inflation rate (excl. food & energy prices) also eased to xx% from xx% last month.
Inflation lowest since xxxx: Headline CPI inflation increased by xx% YoY, down from xx% in March but above expectations of a slowdown to xx%.
Core CPI: which excludes energy, food, alcohol, and tobacco, also eased to xx% from xx% in March, but remained above expectations (xx% forecast).
Goods and services inflation: The CPI goods annual rate fell into negative territory (xx%) but services inflation remained sticky, falling marginally to xx from xx last month, somewhat higher than the xx forecast by the Bank of England (BoE).
Energy prices fall: Downward pressure primarily stemmed from housing and household services, driven by a substantial decline in gas and electricity prices following Ofgem's adjustment of the energy price cap.
This resulted in a record fall of xx% in prices of electricity, gas, and other fuels, providing relief to consumers facing high energy costs and equating to a household saving of £238 per year.
Food inflation eases: Food and non-alcoholic beverages also contributed to the easing of inflation, with prices rising by xx% YoY from xx% last month – the lowest level since xxxx.
Further falls in energy bills and food inflation should see inflation moderate in the coming months and remain around its 2% target in 2024.
However, the unexpected stickiness of services inflation has tempered market anticipation for an interest rate cut at the next Bank of England (BoE) meeting in June, reducing the probability of a cut to approximately 13%. Current market forecasts now point to September as the most probable month for the first rate reduction.
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Inflation eases
Source: ONS
