Inflation has fallen to 2.3% in the year to April, missing the expected analysts' figure of 2.1%, bringing some doubt to a potential cut in the Bank of England (BoE) base rate in June.

The Office for National Statistics (ONS) revealed that consumer price index (CPI) inflation came down from 3.2% in the 12 months to March.

Falling gas and electricity prices were cited as the largest downward contributors to the monthly change in the CPI, partially offsetting upward contributions from motor fuels.

Core CPI stood at 3.9% in the 12 months to April, down from 4.2% in March.

Furthermore, food and non-alcoholic beverage prices have increased by 2.9% in the year to April, a rate that has come down from 4% in March.

This is the lowest annual rate for this sub-sector since November 2021, easing for the thirteenth consecutive month from a high of 19.2% in March 2023, which is the highest annual rate seen for over 45 years.

Although the inflation rate is creeping closer to the BoE’s 2% target, the latest figure is 0.2% over analysts’ expectations of a 2.1% increase in April.

As a result, many commentators believe that this could cause a delay in the reduction of the BoE’s base rate, which has remained at 5.25%, the highest rate for 16 years, for six consecutive periods.

This comes after the deputy governor at the BoE, Ben Broadbent, hinted that it is "possible" that the base rate could be cut over the summer.

Head of financial analysis at AJ Bell, Danni Hewson, said: "Just like that, expectation of a June rate cut has been washed away like confetti after rain-soaked summer wedding. Within minutes of the official inflation numbers hitting our screens market expectation that the Monetary Policy Committee could shift the base rate down next month plummeted from 50/50 to just over 10%.

"Households which have had the benefit of a real term wage increase in the past few months will be feeling a little better about their finances, but things are still expensive, and some services in particular are still delivering unpleasant surprises.

"Strip out those volatile bits from the equation – food and energy costs which caused such misery over the past couple of years – and core inflation is still stubbornly high."

Head of money and markets at Hargreaves Lansdown, Susannah Streeter, added: "The rate of inflation hasn’t been this low for almost three years, but sticky services inflation will remain a worry, and policymakers at the BoE will also want to see more evidence that stubborn wage rises show signs of easing. Interest rate probabilities indicate the markets expect a rate cut to be delayed until at least August."

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