UK Inflation Hits 2.1%

Inflation in Britain unexpectedly jumped, exceeding the target of the Bank of England in May, reaching 2.1%, in the context of the rise in prices after the end of the general isolation measures from Corona, which is expected to gain momentum.

This acceleration of the consumer price index after recording 1.5% in April largely reflects how weak inflation was in May 2020, when the economy was suffering the brunt of the first strict public isolation measures.

The figure represents the first time that inflation exceeded the 2% target rate of the Central Bank in nearly two years, and it also exceeded the expectations of all 33 economic experts who participated in a Reuters poll, which indicated that inflation would rise to 1.8%.

The price data was collected on or around May 11, which means that before bars and restaurants were allowed to serve customers inside and movie theaters and hotels reopened from May 17.

The Bank of England had expected inflation to reach 2.5% by the end of this year, before stabilizing at its 2% target, as the impact of the rise in energy prices after the general isolation eased.

The central bank is expected to keep monetary policy unchanged on June 24 after its latest meeting.

The Office for National Statistics said core inflation, which strips out prices for food, energy, and other volatile goods, rose to 2% in the 12 months to May from 1.3% in April.