UK Inflation Higher than Forecast in May

UK inflation was higher than expected in May as rising food prices offset a drop in air fares and transport costs, new official figures show.

The rate of Consumer Prices Index (CPI) inflation fell to 3.4% in May from 3.5% in April, the Office for National Statistics (ONS) said.

However, the ONS said that an error in vehicle tax data collected meant April's CPI rate should have been 3.4% - but that it was not revising the official figure.

Most economists were expecting the CPI rate to come in at 3.3% for May as price rises cooled following a raft of bill increases the previous month, that pushed inflation to the highest level in more than a year.

ONS acting chief economist Richard Heys said: "A variety of counteracting price movements meant inflation was little changed in May.

"Air fares fell this month, compared with a large rise at the same time last year, as the timing of Easter and school holidays affected pricing. Meanwhile, motor fuel costs also saw a drop.

"These were partially offset by rising food prices, particularly items such as chocolates and meat products. The cost of furniture and household goods, including fridge freezers and vacuum cleaners, also increased."

Chancellor Rachel Reeves said there was "more to do" to bring down inflation and help with the cost of living.

She said the Government's "number one mission is to put more money in the pockets of working people".

She said: "We took the necessary choices to stabilise the public finances and get inflation under control after the double digit increases we saw under the previous government, but we know there's more to do.

"Last week we extended the £3 bus fare cap, funded free school meals for over half a million more children and are delivering our plans for free breakfast clubs for every child in the country.

"This Government is investing in Britain's renewal to make working people better off."