Inflation coverage on this page tracks the numbers and the decisions they force. Recent stories follow UK inflation holding at 2.8% in May as cheaper food offsets soaring transport costs, and food inflation easing to 2.2% as grocery pressure finally loosens its grip. The Bank of England is the recurring protagonist, repeatedly expected to hold rates at 3.75% as the Middle East oil shock derails hopes of summer cuts, while the IMF trims its global growth forecast and petrol, energy bills and headline prices absorb the surge.
Annual food and drink inflation slowed from 3.0% to 2.2% in the year to May, the latest tracking shows, offering tentative relief to households even as the weekly shop remains far dearer than it was three years ago.
The Office for National Statistics says the headline rate was unchanged from April, defying forecasts of a rise, as falling grocery prices balanced out the steepest jump in transport costs in more than three years.
Economists are near-unanimous that the Monetary Policy Committee will leave borrowing costs unchanged on Thursday, with Middle East tensions and a looming energy bill rise tempering hopes of further cuts this year.
The Bank of England's Monetary Policy Committee is widely expected to keep interest rates at 3.75% on 18 June, with energy-driven inflation risks dividing the panel and dampening hopes of cuts later this year.
Economists are virtually unanimous that the Monetary Policy Committee will leave borrowing costs unchanged on Thursday, with a Middle East oil-price spike forcing rate-setters into a holding pattern just as households had begun to hope for relief.
The Fund now expects the world economy to expand just 3.1% in 2026, warning that a sustained oil-price shock could push the world close to recession and reignite inflation.
The Monetary Policy Committee is widely expected to keep Bank Rate unchanged on 18 June, balancing softer inflation against the threat of higher energy costs from Middle East tensions.
A conflict in the Middle East has sent crude prices soaring, lifting petrol prices, threatening higher household energy bills from July and reviving the cost-of-living squeeze just as Britain thought the worst was behind it.