UK inflation stays at 2% target in June, leaving possible rate cut on a ‘knife edge’

Associated Press

LONDON (AP) — Inflation in the U.K. held steady at the Bank of England’s target rate of 2% in June. The Office for National Statistics said Wednesday that the largest upward contribution came from restaurants and hotels, with some economists attributing the increases to Taylor Swift’s tour of the U.K. The biggest downward contribution came from clothing and footwear, with widespread sales during the month. The flat annual reading compared to June a year ago was a tad higher than expected. Most economists had anticipated a modest decline to 1.9% Financial markets think it’s going to be a close call as to whether the Bank of England will reduce its main interest rate from 5.25% on Aug. 1.