CPI inflation jumps to 2.7% in May

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The consumer prices index grew by 2.7 per cent over the year to May, up from 2.4 per cent in April.

The biggest increase came from transport, notably motor and air travel, and clothing, while the largest price drops came from food.

The inflation rate has returned to the levels seen between October 2012 and March 2013 after slowing to 2.4 per cent in April.

Capital Economics chief UK economist Vicky Redwood says: “May’s rise in UK inflation confirms that April’s drop was just a blip, although the peak is hopefully not too far away now.

”Inflation will probably get above 3 per cent in the next month or two – meaning that one of Mr Carney’s first jobs will be to write an explanatory letter to the chancellor. But thereafter it should begin a slow but steady drift down, getting to its target around the start of next year.

CPIH, the new measure of consumer price inflation including owner occupiers’ housing costs, grew by 2.5 per cent in the year to May 2013, up from 2.2 per cent in April.

The ONS currently classifies CPIH as an experimental statistic. The slower growth in CPIH than CPI is due principally to owner occupiers’ housing costs increasing more slowly than other consumer goods and services.