UK Inflation Slows to 2.6%, Supporting Homebuyers and Keeping Retail Prices Low

New data from the Office for National Statistics show that the United Kingdom's annual inflation rate fell from 2.8% in May to 2.6% in June, the lowest level in 15 months. The decline was driven by lower food and fuel prices, easing cost‑of‑living pressures for households. Analysts expect the slowdown to improve mortgage‑rate confidence for the Bank of England, potentially stabilising borrowing costs and boosting confidence among prospective homebuyers and sellers.

At the same time, the BRC‑NIQ Shop Price Monitor reported that shop price inflation dropped to 0.9% year‑on‑year in July, with non‑food price growth at 0.2%, both below the three‑month average. Retailers are maintaining low price growth despite broader cost pressures, helping to keep everyday consumer prices stable.