UK inflation exceeds expectations in May, piling pressure on the government and Bank of England

LONDON — U.K. ostentation came successful hotter than expected successful May, arsenic user prices roseate by an yearly 8.7%, unchanged from the erstwhile month.

Economists polled by Reuters had projected an yearly emergence successful the header user terms scale (CPI) of 8.4%.

On a monthly basis, header CPI roseate by 0.7%, portion halfway ostentation — which excludes volatile energy, food, intoxicant and baccy prices — roseate by an yearly 7.1%, up from 6.8% successful April and the highest complaint since March 1992, according to the Office for National Statistics.

"Rising prices for aerial travel, recreational and taste goods and services, and second-hand cars resulted successful the largest upward contributions to the monthly alteration successful some the CPIH and CPI yearly rates," the ONS said.

Inflation dipped beneath 10% annually successful April but continues to transcend statement forecasts and remains importantly higher than the Bank of England's 2% target.

The cardinal slope volition denote its adjacent monetary argumentation determination connected Thursday and is wide expected to instrumentality its 13th consecutive involvement complaint hike arsenic it faces the perilous balancing act of reining successful ostentation without creating a owe situation and recession.

Sticky ostentation and a persistently choky labour marketplace person led economists successful caller weeks to summation their forecast for highest involvement rates, and the rhythm of monetary argumentation tightening is present expected to past longer than antecedently expected.

The Organization for Economic Cooperation and Development projected earlier this period that the U.K. volition station yearly header ostentation of 6.9% this year, the highest level among each precocious economies.