UK inflation slows to 3.4% in May as transport costs ease – business live

Inflation forecast to remain broadly flat over next few months, leaving door open for August interest rate cut

Inflation in the UK has slowed slightly, as expected.

The consumer prices index rose by 3.4% year on year in May, down from 3.5% in April, according to the Office for National Statistics. This was bang in line with City economists’ forecasts. The central bank’s target is 2%.

The core rate, which excludes energy and food, fell to 3.5% from 3.8%, also as expected.

The Consumer Prices Index (CPI) rose by 3.4% in the 12 months to May 2025, compared with 3.5% in the 12 months to April.