Inflation Holds at 2.8% as Transport Pressures Offset Food Slump

What's happened

Inflation has held steady at 2.8% in May, the same as April, with transport costs (air fares, petrol) and taxes offset by slower food price rises. Petrol and fuel costs rise; airfares surge due to Easter timing, while food and heating costs ease. The Bank of England faces decisions as rate prospects remain uncertain.

What's behind the headline?

Key questions arising from the data

• How durable is the May 2.8% reading given ongoing Middle East tensions and oil price dynamics?
• Will transport costs continue to drive inflation higher, or will food price relief persist?
• What should readers expect from the Bank of England in the coming weeks?

Implications for households

• A steady inflation backdrop keeps real incomes under pressure but offers some relief on energy bills for now.
• Gas and electricity bills remain capped, limiting household cost growth in the short term.

Forecasts

• Inflation is likely to hover around 2.8% in the near term, with risks skewed to the upside if transport costs rebound or energy prices rise. The BoE policy path will depend on wage growth and global energy dynamics.

How we got here

ON S data show inflation has remained at 2.8% in May, unchanged from April. Transport costs push up prices while food price declines offset gains. Ofgem’s energy cap and geopolitical factors influence energy and fuel prices, shaping expectations for future policy and rate moves.

Our analysis

The Independent reports inflation at 2.8% in May with transport pressures; The Guardian confirms the same rate and notes that rate decisions are ahead; The Scotsman highlights relief for businesses and households as inflation flatlines; Henry Saker-Clark of The Independent and Heather Stewart of The Guardian provide corroboration with emphasis on energy and transport costs.

Go deeper

• Will inflation stay at 2.8% in June or rise with oil prices?
• When will the Bank of England decide on rate changes given these numbers?
• How will households adapt if transport costs continue rising?

More on these topics

• Office for National Statistics

  The Office for National Statistics is the executive office of the UK Statistics Authority, a non-ministerial department which reports directly to the UK Parliament.

• Bank of England - Bank in London, England

  The Bank of England is the central bank of the United Kingdom and the model on which most modern central banks have been based.

• United Kingdom - Country in Europe

  The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom or Britain, is a sovereign country located off the north­western coast of the European mainland.

• Iran (Islamic Republic of Iran) - Country in the Middle East

  Iran, also called Persia, and officially the Islamic Republic of Iran, is a country in Western Asia. It is bordered to the northwest by Armenia and Azerbaijan, to the north by the Caspian Sea, to the northeast by Turkmenistan, to the east by Afghanistan a

• Rachel Reeves - Member of Parliament of the United Kingdom

  Rachel Jane Reeves is a British Labour Party politician serving as Shadow Chancellor of the Duchy of Lancaster and Shadow Minister for the Cabinet Office since 2020. She has been the Member of Parliament for Leeds West since 2010.

• Russia - Country

  Russia, or the Russian Federation, is a transcontinental country located in Eastern Europe and Northern Asia. Covering an area of 17,125,200 square kilometres, it is the largest country in the world by area, spanning more than one-eighth of the Earth's in

• Middle East - Region

  The Middle East is a transcontinental region that generally includes Western Asia, all of Egypt, Iran, and Turkey. Soviet Central Asia, Afghanistan, and Pakistan are generally excluded.