The primary gauge for inflation, the consumer price index (CPI), rose 0.2% from a year earlier in May, signaling a pause in the slowdown trend that had appeared to ease since January. In April the pace slowed to 0.1% from 0.7% in March, reaching a one-year low. The latest data from the Office for National Statistics (ONE) came in just below analysts’ expectations of 0.3% growth, adding nuance to the inflation narrative that policymakers and markets are watching closely in the United States and Canada alike.
ONE statistician Dong Lijuan noted on the agency’s site that consumer demand remains on a path to recovery as we move through the fifth month of the year, with overall conditions described as generally stable. She highlighted noticeable price increases in certain food categories—poultry rising 5.6%, oils 3.6%, and fresh fruit 3.4%—along with higher costs for some travel-related items, including airplanes. Airline tickets showed a year-over-year gain of 14.7%. On a monthly basis, prices dipped 0.2% from April, slightly softer than expectations that called for a 0.1% decline.
In addition, ONE released its Producer Price Index (PPI), which tracks price change at the wholesale level. May marked a 4.6% year-on-year decline, a figure that was 1 percentage point and 0.3 percentage points milder than in April and somewhat below forecasters’ projections. Dong explained that the move lower reflects factors such as a continuing drop in international commodity prices, weak demand at both domestic and international levels, and the base effects that compound year-over-year comparisons, shaping the broader picture for producers and consumers alike.