Annual inflation remained at 8.7% in May – the same as in April – according to latest statistics from the Office for National Statistics (ONS).
Rising prices for air travel, second-hand vehicles and video games contributed to the unexpected inflation rate.
However, rising prices were partially offset by falling motor fuel costs, which dropped by 13.1% in the 12 months to May.
Food and non-alcoholic drink inflation also eased slightly after peaking earlier this year, falling from 19.1% in April to 18.4% in May.
While overall inflation remained the same last month, core inflation, which excludes the costs of food and fuel, rose from 6.8% to 7.1% during the 12 months to May.
According to Kitty Ussher, chief economist at the Institute of Directors, stubbornly high inflation leaves “little doubt” that the Bank of England will raise interest rates later today.
David Bharier, head of research at the British Chambers of Commerce, cited inflation as the top issue for many firms. He continued:
“What started as a commodity price shock has now created a wage-price spiral.
“Action by the Government to help with the squeeze on the labour supply, reform of business rates and support on exports would go some way to helping them face the future with more confidence.”
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