UK inflation remained at a one-year low of 2.4 per cent in May, despite many economists predicting a rise to 2.6 per cent following a surge in the cost of global oil prices.
Figures from the Office for National Statistics (ONS) suggest that average petrol prices have soared to their highest level in nearly four years. However, contrary to economists’ predictions, this has not affected the consumer prices index (CPI).
According to analysts, this is largely due to the falling cost of commodities such as chocolate, sweets and computer games, which have helped to ‘offset’ the ever-increasing cost of oil.
Crude oil prices have risen by more than 40 per cent in the past year on global markets and British motorists continue to feel the squeeze.
Nevertheless, inflation remained at its one-year low of 2.4 per cent in May, matching the rate recorded in April.
Generally speaking, inflation has been falling slowly ever since a five-year high of 3.1 per cent was recorded in back in November last year.
Groups such as the TUC have raised concerns that the data could encourage the Bank of England (BoE) to delay increasing interest rates.
Frances O’Grady, the TUC’s General Secretary, said: “The case for higher interest rates is falling further away. Instead of an autumn rate rise, we will need an autumn boost in the budget to get the economy moving and wages rising faster.”
The comments come after separate data recently revealed an unexpected slowdown in UK wage growth.