British inflation rate accelerates to 2.7% in May

The British Consumer Price Index (CPI) rose to 2.7 percent in May from 2.4 percent in April, the Office of National Statistics (ONS) said Tuesday. "The inflation rate has returned to the levels seen between October 2012 and March 2013 after the slowing in the rate to 2.4 percent in April," said the ONS. The ONS said that the largest upward contributions to the change in the rate came from transport, notably air transport and motor fuels, as well as clothing. Meanwhile, the largest downward contribution came from food. Inflation will probably get above 3 percent in the next month or two - meaning that one of Mark Carney's first jobs will be to write an explanatory letter to the Chancellor of the Exchequer as soon as Carney becomes governor of the Bank of England (BoE) in July, said Capital Economics, a macro-economic analysis company in London. For years, the CPI growth rate keeps staying higher than BoE's target of 2 percent, constraining BoE's efforts on expanding its quantitative easing monetary policy.