Benign UK Inflation Data Reduces Chance of June Rate Hike

UK headline inflation dropped to 2.8% in April, casting significant doubt on a Bank of England rate hike in June. ING believes markets are overestimating the central bank's willingness to tighten policy.

Key Takeaways

• 1.UK headline inflation fell to 2.8% in April from 3.3% in March, coming in below consensus expectations.
• 2.The benign data reduces the likelihood of a Bank of England rate hike in June, which was previously a narrow base case.
• 3.Regulated and administrative prices, such as water bills and household energy policy costs, significantly contributed to the headline drop.

Table of Contents

• Benign UK inflation data reduces chance of June rate hike
• How UK inflation changed between March and April
• Author
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