- Annual CPI inflation in May 2014 was 1.5%, down from 1.8% in April
- The largest contributions to the fall in inflation came from a fall in airfares, food, non-alcoholic drinks and clothing
- These were partly offset by upward contributions from motor fuels, recreation and culture
- Goods price inflation in May 2014 was 0.9%, while services inflation was 2.2%
Commenting on the CPI inflation figures for May 2014, published today by the ONS, David Kern, Chief Economist at the British Chambers of Commerce (BCC) said:
“The continued fall in inflation below the 2% target is good news for businesses and consumers, and supports our calls for the MPC to avoid jumping the gun on interest rate rises. Although the unstable situation in Iraq may put upward pressures on energy costs, all domestic influences point towards continued low inflation.
“While there may be a case for official interest rates to start edging up in early 2015, interest rates must remain on hold for the foreseeable future to reassure businesses. To secure a lasting recovery the government should continue to provide further measures in key areas such as improving access to finance for growing firms, and supporting UK exporters.”