UK economy

Another dovish inflation result in May undershoots forecasts

May’s undershoot for UK inflation supports our view early last month that the Bank of England (BoE) should not increase Bank Rate this year. Relative to its latest (April) projection, May’s result for inflation was 50bp lower, included for services inflation which was 20bp lower. We still expect a cut to Bank Rate before the end of the year given a weak labour market and limited scope for higher prices and wages in response to war in the Middle East.

• Kevin Timoney
• Morning briefing
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