TOP NEWS: UK inflation above BoE's 2% target for first time since 2019

(Alliance News) - UK consumer prices jumped in May, figures on Wednesday showed, with inflation ...

Alliance News 16 June, 2021 | 7:19AM
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(Alliance News) - UK consumer prices jumped in May, figures on Wednesday showed, with inflation exceeding the Bank of England's 2% target for the first time in nearly two years.

The Office for National Statistics said the UK consumer price index jumped 2.1% on an annual basis in May, accelerating from 1.5% growth in April.

May's annual inflation print was the highest reading since the same 2.1% growth rate was registered in July 2019. Consumer price growth has remained below 2% ever since then. The Bank of England targets a 2% inflation rate.

"The rate of inflation rose again in May and is now above 2% for the first time since the summer of 2019," said Grant Fitzner, ONS chief economist.

"This month's rise was led by fuel prices which fell this time last year, but have jumped this year thanks to rising crude prices," Fitzner added. "Clothing prices also added upward pressure as the amount of discounting fell in May."

Prices of fuels & lubricants surged 18% in May, while clothing prices rose 2.6%, ticking up from growth of just 0.5% in April.

Month-on-month, UK consumer prices rose 0.6% in May to match April's rate of growth.

A separate release from the ONS on Wednesday showed UK producer price inflation also strengthened in May.

Output prices grew 4.6% in the year to May, accelerating from growth of 4.0% in April, while input prices jumped 11% on a 12-month basis, again ticking up from April when prices grew 10%. May's input price growth was the highest rate since September 2011.

By Lucy Heming;

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