Inflation in the UK remained at 2.4% in May, according to figures from the Office for National Statistics. This is the third month in a row that UK inflation has been at 2.4%, despite a promising start to the year and a steady reduction from 3%.
The ONS attributes the failure of inflation to fall further to a rise in fuel prices of around 3.8%, triggered by the increased cost of crude oil. The gold price is currently £978.95 per ounce – up £23.68 in the past month. Inflation concerns have swung investor interest back to gold, resulting in this latest price rise.
The concern is that while 2.4% is an improvement on the climbing inflation figures from 2017, it comes at a time when UK wage growth is slowing down, and manufacturing output suffered its biggest decline for nearly six years.
The Bank of England are next due to meet on June 21st for a Monetary Policy Summary and will publish the minutes from the Monetary policy Committee meeting. It’s expected that the meeting after, on August 2nd, will be the likely point where the BoE announces another interest rate rise.
