Dramatic Fall In Inflation Rate For May

The underlying rate of inflation saw a sharp fall last month, to 1.8%, compared to 2.3% in April, according to the Office of National Statistics. Most analysts were not expecting such a dramatic decrease, which makes an increase in interest rates, to dampen spending, less likely.

It is thought that the slowing of the inflation rate is due to lower food and fuel prices. The headline rate of inflation for May was 1.1%.

The Retail Prices Index was 176.2.

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