U.K. consumer price inflation slowed more-than-expected to a seven-month low in April on falling petrol and air fares, official data revealed Tuesday. The slowdown provides relief for consumers as it raises purchasing power, while it gives more scope for the central bank to ease monetary policy.
In addition, reflecting weakness in petroleum prices, factory-gate inflation reached its lowest level since September 2009.
Annual inflation fell to 2.4 percent from 2.8 percent in March, the Office for National Statistics said. Inflation was expected to ease to 2.6 percent.
Although inflation moved closer to the central bank's 2 percent target, it is likely to be short-lived with prices gaining momentum further in the months ahead. The Bank of England estimates inflation to peak at around 3 percent in the third quarter of this year.
There is still scope for monetary policy to do more to stimulate the economy without setting it on a course to miss the inflation target, Samuel Tombs, an economist at Capital Economics, said.
Month-on-month, consumer prices gained 0.2 percent, slightly weaker-than the prior month's 0.3 percent increase and below the consensus forecast of 0.4 percent. Core inflation that excludes energy, food, alcoholic beverages and tobacco also slowed in April, to 2 percent from 2.4 percent a month ago. The rate was marginally below the expected 2.3 percent.
The new measure of consumer price inflation, CPIH covering owner occupiers' housing costs, grew 2.2 percent from a year ago, slower than 2.6 percent in March.
Similarly, retail price inflation eased sharply to 2.9 percent in April, while it was forecast to fall to 3.1 percent.
A separate report from the ONS showed that output price inflation eased more-than-expected to 1.1 percent year-on-year in April, the lowest since September 2009, from 1.9 percent in March. Economists had expected a 1.4 percent rise.
On a monthly basis, output prices fell 0.1 percent against expectations for a 0.2 percent increase as seen in March.
Core factory gate prices, excluding the more volatile food, beverages, tobacco and petroleum products, rose 0.8 percent year-on-year in April, slower than a rise of 1.3 percent in the year to March.
Meanwhile, input prices decreased 0.1 percent annually in April compared with a rise of 0.8 percent in the year to March. This was against expectations for a 0.3 percent rise. Compared to March, input costs slid 2.3 percent versus an expected 1.3 percent fall.
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April 24, 2026 15:15 ET Economics news flow was relatively light this week even as the conflict in the Middle East continued, raising concerns for policymakers. In the U.S., spending data, initial jobless claims and pending home sales were the highlights. Business confidence in the biggest euro area economy was in focus in Europe. Inflation data from Japan gained attention in Asia.