Clarke & Co

Inflation falls to 2%

Talk to an expert

Figures released by the Office of National Statistics show that the Consumer Prices Index (CPI) for May 2024 was 2%. This is a reduction from the 2.3% assessed in April and means that inflation has hit the Bank of England’s target rate for the first time in nearly 3 years.


The main reason for the drop is food, where prices are falling now but were rising a year ago. However, it is worth noting that food prices are generally still 25% higher than they were at the beginning of 2022.


The main upward pressure on inflation currently is coming from petrol since prices are rising whereas they were falling a year ago.


The fall in inflation doesn’t mean that prices overall are coming down, just that they are rising more slowly.


The Bank of England met on Thursday last week to discuss their interest base rate. This has been set at 5.25% since August 2023 and they decided to maintain that rate. This means no relief yet for borrowers, but in view of the inflation news, a reduction in the base rate is expected within the next few months.


See:


https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/consumerpriceinflation/latest

September 10, 2025
Rising Borrowing Costs Put Pressure on the Chancellor

The UK government is facing a fresh financial squeeze after long-term borrowing costs climbed to their highest level in a generation. The yield on 30-year government bonds (known as gilts) has reached 5.72% – the highest since 1998.

Read article
September 8, 2025
Six Lessons for Businesses from Royal Mail’s Return to Profit

After three years of losses, it’s been reported that Royal Mail has returned to profit under its new owner, Czech billionaire Daniel Kretinsky.

Read article