FX.co ★ UK Core Inflation Rate Slows More than Expected

In May 2025, the United Kingdom experienced a reduction in its annual core inflation rate, which decreased to 3.5% from the previous month's one-year peak of 3.8%. This figure was slightly lower than the market's expectations of 3.6%. The deceleration was largely attributed to a reduction in the CPI services rate, which fell to 4.7% from 5.4% in April, although the CPI goods rate saw an increase from 1.7% to 2.0%. On a month-to-month basis, core consumer prices rose by 0.2%, aligning with projections and representing a significant decline from the substantial 1.4% increase observed in April. This marks the mildest monthly rise in four months, indicating a potential easing of underlying inflationary pressures.