THE UK's rate of inflation hit the Bank of England's target last month in a boost for Rishi Sunak and with just over two weeks left until the General Election.
Consumer Prices Index (CPI) inflation stood at 2% in May according to fresh numbers from the Office for National Statistics (ONS).
This is down from 2.3% in the 12 months to April, which marked the lowest level in around three years.
It is also down from a peak of 11.1% in October 2022, which was driven by soaring gas and electricity prices.
The latest figures mean inflation has hit the BoE's target of 2% for the first time since July 2021.
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They will come as a boost to Rishi Sunak who made lowering inflation one of his party's five pledges in January last year.
Posting on X earlier this morning, the Prime Minister said: "Great news this morning that inflation is back to normal at 2%.
"That's lower than Germany, France and America.
"When I became Prime Minister inflation was at 11%, but we took bold action, we stuck to a clear plan and that's why the economy has now turned a corner."
Meanwhile, Jake Finney, economist at PwC, added: "Today marks a decisive moment in the fight against inflation as it is the first time it has been confirmed that CPI inflation has returned to the Bank of England’s 2% target in almost three years.
"This is the longest period that inflation has exceeded the 2% target since the early 2010s, when it took four years to return to target."
Inflation is a measure of how much the prices of everyday goods such as food and clothes, and services such as train tickets and haircuts, have increased compared to a year earlier.
It's important to note when inflation falls that doesn't mean prices have stopped rising, they are just increasing at a slower pace.
The BoE will be watching today's figures closely as it decides whether to lower its base rate tomorrow (June 20).
However, the central bank is not expected to cut interest rates until after the General Election on July 4.
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It offers hope to mortgage holders and prospective buyers that interest rates could come down sooner rather than later though.
It comes with interest rates at a 16-year high of 5.25%.
What it means for your money
Because inflation is a measure of how much the price of a basket of goods is rising, if it slows it's good news for your pocket.
However, even if inflation is slowing, it still means prices are rising, just at a slower pace.
Alice Haines, personal finance analyst at BestInvest, said: "Hitting the 2% inflation milestone will be a major moment for the BoE after a long, drawn-out battle to bring rampant inflation down from the double-digit levels seen just over a year ago."
She added the news inflation has slowed to 2% would be "comforting" for households.
However, she said it would be unlikely to lead to an interest rate cut any time soon.
The analyst said: "It is unlikely to result in an immediate rate cut tomorrow as CPI services inflation has slowed but remains stubbornly high and core inflation, which strips out the more volatile items such as food, alcohol and tobacco, has eased but continues to sit above the 3% mark."
Whether inflation will stay at the 2% rate for the foreseeable future is yet to be seen too.
Luke Bartholomew, deputy chief economist at Abrdn, said: "The big question now is whether underlying inflation pressures in the economy are consistent with inflation staying around 2% in the medium term, or whether inflation will start to edge higher again once favourable base effects fade.
"On that front, there is still evidence of residual stickiness in services inflation, reflecting the strength of wage growth recently.
"That is why an interest rate cut tomorrow is still very unlikely.
"But we think the Bank’s communication tomorrow will set out a path for a cut in August, which is now looking increasingly likely."
The National Debtline said although inflation was slowing, those on the lowest incomes were still struggling.
Steve Vaid, chief executive of the Money Advice Trust, the charity that runs National Debtline said: "Our National Debtline advisers continue to hear from people grappling with debts for essential costs including energy, council tax, and rent or mortgage repayments.
"I would urge anyone worried about their bills to seek free, independent debt advice from National Debtline.
"No one needs to struggle alone – our advisers are here to help."
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