UK Inflation Holds At 2.0 Percent

Britain’s inflation rate held steady in June after returning to the Bank of England’s target the previous month, official data showed on Wednesday, confounding expectations for another modest slowdown.
The Consumer Prices Index was unchanged at 2.0 percent in June from the same level in May, the Office for National Statistics said in a statement, compared with market forecasts of 1.9 percent as analysts said the data could cause the Bank of England to sit tight for a while longer before starting to cut interest rates.
Recall that, last month, the BoE kept its key interest rate at a 16-year high of 5.25 percent, despite slowing inflation in May and elevated interest rates have worsened UK cost-of-living squeeze, because they increase borrowing repayments, thereby cutting disposable incomes and crimping economic activity.
The BoE began series of rate hikes in late 2021 to combat inflation, which rose after countries emerged from Covid lockdowns and accelerated after the invasion of Ukraine by key oil and gas producer Russia.