British inflation falls to 2% in May, a relief for Sunak but perhaps too late

Good news for the British government: inflation finally returned to the 2% target of the Bank of England (BoE) in May, for the first time in almost three years, according to official figures published on Wednesday.

This slowdown in price increases, after months marked by the economic impact of the COVID-19 pandemic and Russia’s invasion of Ukraine, should be welcomed with relief by Prime Minister Rishi Sunak at the The legislative elections on July 4 are approaching. The Bank of England, which meets on Thursday, could also welcome this.

However, it is likely that this improvement will not be enough to reverse the trend. Opinion polls predict a victory for the opposition Labor Party in the elections, while the BoE has already indicated that a return of inflation to its target is not in itself a sufficient reason to lower interest rates.

Despite this slowdown, which is more significant than in the euro zone or the United States, inflation in the United Kingdom has still increased by around 20% over the last three years. This surge in prices has weighed heavily on citizens’ living standards, contributing to growing disaffection with Rishi Sunak’s Conservative Party, accused of not doing enough to counter the purchasing power crisis.

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