UK inflation falls to 2.6% in June
The UK inflation rate dropped to 2.6% in June, down from 2.8% in May, indicating a slowdown in price rises.
The Full Story
A plain summary built from the channels that reported this story.
UK inflation fell to 2.6% in June, down from 2.8% in May, according to the Office for National Statistics. The slowdown was driven largely by falling fuel prices, with diesel dropping 10 pence a litre and petrol down 2 pence. Food price inflation also eased, with items such as chocolate, margarine and pizza becoming cheaper. The figures mark the lowest inflation rate in 15 months.
However, economists and analysts have warned the decline is likely temporary. The fall in fuel prices reflected a ceasefire in the Gulf region that lowered global oil prices in June. But that ceasefire has since frayed, and oil prices have risen again, reaching $95 a barrel. Higher domestic energy prices, which rose 13% in July due to the energy price cap, are expected to feed into next month's data, pushing inflation back up towards 3% and possibly higher.
The Bank of England is due to decide on interest rates next week. Markets currently expect rates to be held at 3.75%, but some analysts are factoring in a possible quarter-point increase later this year. The new government has announced cost-of-living measures such as temporarily removing VAT from electricity and freezing bus fares, which may shave a small amount off inflation in the months ahead. But the underlying risk from rising energy costs and renewed tensions in the Gulf remains the dominant concern for the economic outlook.
On screen
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Key Claims
Claims reported during this story's coverage, mapped by channel. Ordered by how many channels carried each claim.
| Claim | Channel 5 | BBC One | ITV | Sky News |
|---|---|---|---|---|
| UK inflation fell to 2.6% in June from 2.8% in May, partly due to lower fuel and food prices. | ||||
| Most economists expect inflation to rise again due to the fraying US-Iran agreement and rising oil and gas prices. | · | · | ||
| Gas prices are at their highest level since the Iran war started. | · | · | · | |
| Inflation was expected to rise to 3% in the coming months due to domestic energy price increases. | · | · | · | |
| Oil prices rose above $120 a barrel after the war began, then fell below $80, and are now above $90. | · | · | · | |
| Petrol prices averaged £1.56 per litre in June. | · | · | · | |
| The Bank of England base rate is at 3.75% and markets expect a hold at the next meeting but factor in a quarter-point increase. | · | · | · | |
| The Bank of England will decide on interest rates next week. | · | · | · | |
| Weak economic growth and a subdued labour market led to cautious household spending and companies struggling to pass on higher costs. | · | · | · |
Channel Perspectives
What each channel focused on, with key quotes.
5 News gave a very brief, straightforward report on the inflation figure, focusing on the specific items that fell in price (diesel, chocolate, margarine, pizza). It also mentioned the upcoming Bank of England decision but did not provide any analysis of temporary factors or geopolitical context. The report was sandwiched between unrelated stories about type 2 diabetes and a puffin sighting, indicating a lower priority for depth.
- “inflation slowed to 2.6% in June compared to 2.8% in May”
- “The fall is partly due to fuel prices, especially diesel, as well as lower prices for chocolate, margarine and pizza.”
BBC One West provided a detailed analysis, emphasising the temporary nature of the fall. It highlighted the role of the Gulf ceasefire in lowering oil prices, but warned that domestic energy price rises and renewed tensions would push inflation back up to 3% or higher. The report also noted the Bank of England's upcoming decision and the impact of oil price spikes on future inflation.
- “UK inflation fell slightly to 2.6% last month. It had been 2.8% in May.”
- “the change was largely caused by a drop in fuel prices”
- “domestic energy prices haven't fed through to the inflation numbers yet... will go back up again as high as 3%”
Sky News used the inflation announcement to launch its new 'Economic Pressure Tracker', an interactive tool monitoring the impact of the war in Iran on UK costs. The report focused heavily on the geopolitical context, particularly oil prices and Strait of Hormuz shipping, and linked the inflation fall to the temporary ceasefire. It also discussed interest rate expectations and the risk of a quarter-point increase.
- “consumer price inflation figure for June. It was 2.6%, down a little from May's figure at 2.8%”
- “fuel prices, the decline in transport costs, was the biggest driver of that”
- “oil price... back up above 90 now. That is a flashing red light on not just our dashboard, but across the global economy.”
ITV1 framed the inflation fall as the lowest in 15 months and linked it to the ebb and flow of the Gulf war. It included a quote from the Chancellor (John Healey) welcoming the news but signalling further action. The report also highlighted cost-of-living measures such as VAT removal on electricity and bus fare freezes, and noted that most economists expect inflation to rise again due to fraying ceasefire and rising oil and gas prices.
- “Inflation fell to the lowest level in 15 months in June”
- “The price of diesel last month fell by 10 pence a litre. The price of petrol was down two pence.”
- “most economists do expect inflation to rise again, not least because the memorandum of understanding between the United States and Iran signed in June is fraying”
Broadcast Timeline
News broadcasts tracked for this story, in time order.