UK inflation decelerates to 2.4% in April, approaching faster to inflation target

• The UK CPI rose 2.4% in April compared with 2.5% y/y expected by the market.
• The UK core CPI rose 2.1% in April compared with 2.2% y/y expected.

The Uk Consumer Price Index (CPI) rose 2.4% over the year in April, decelerating from 2.5% y/y in March while core inflation decelerated to 2.1% y/y from 2.3% in the previous month.

The UK inflation data confirm the Bank of England forecasts in May Inflation Report decelerating towards its 2% inflation target much faster than originally estimated in February and falling off the 3.1% cyclical inflation peak from December last year. The core inflation in April is just one-tenth of a percent off the inflation target.

“Growth—at 0.1% in the first quarter of this year—was much weaker, and inflation—at 2.5% in March—was notably lower than we had projected in February,” the Bank of England Governor Mark Carney said in the opening remarks at the press conference after publishing May Inflation Report on May 10.