Overview
- The Office for National Statistics' April data, published May 20, showed annual CPI fell to 2.8% from 3.3% in March.
- Ofgem's energy price cap was lowered on April 1 after the government shifted much of the renewables charge off household bills, which directly reduced average dual-fuel household costs and pulled down headline inflation.
- Petrol and diesel jumped sharply in April as the US–Iran conflict drove global crude above $100 a barrel, and those higher pump prices already pushed transport inflation up.
- Analysts at Cornwall Insight expect the Ofgem cap to rise by about 12–13% at the July reset, and the Bank of England has modelled scenarios where a persistent energy shock could push inflation substantially higher, including a worst case near 6.2%.
- The government is preparing targeted support for households, including measures such as cancelling a planned fuel duty rise, because many families face significantly higher bills if July's cap increase and further oil-price pass-through occur.