UK Inflation Falls Further
UK inflation slowed more than expected in June 2026. The annual inflation rate fell to 2.6% from 2.8% in May, lower than market expectations of a decline to 2.7%.
This was the lowest inflation rate in the UK since March 2025. The decline was primarily driven by a slowdown in transport inflation, which fell to 5.7% from 6.8% the previous month.
The largest contributor came from lower motor fuel prices, particularly diesel. The average price of diesel fell by 10.7 pence per liter to 176.4 pence per liter, while gasoline prices fell by 2.1 pence to 155.3 pence per liter.
Food inflation also eased to 1.7%, the lowest level since August 2024, from 2.2%. The largest decline came from sugar, jams, syrups, chocolate, and confectionery.
As for the market impact, lower inflation data could ease pressure on the Bank of England to maintain a tighter stance for too long. The pound could potentially weaken if the market begins to price in a faster rate cut, while UK stocks could benefit from positive sentiment as cost and interest rate pressures begin to ease. (asd)*
Source: Newsmaker.id
