UK Inflation Back to 2% Target for 1st Time Since 2021

FILE PHOTO: Prices of food are displayed at the Borough Market as the UK inflation rates fall by less than expected in London, Britain May 22, 2024. REUTERS/Maja Smiejkowska/File Photo
FILE PHOTO: Prices of food are displayed at the Borough Market as the UK inflation rates fall by less than expected in London, Britain May 22, 2024. REUTERS/Maja Smiejkowska/File Photo
TT

UK Inflation Back to 2% Target for 1st Time Since 2021

FILE PHOTO: Prices of food are displayed at the Borough Market as the UK inflation rates fall by less than expected in London, Britain May 22, 2024. REUTERS/Maja Smiejkowska/File Photo
FILE PHOTO: Prices of food are displayed at the Borough Market as the UK inflation rates fall by less than expected in London, Britain May 22, 2024. REUTERS/Maja Smiejkowska/File Photo

British inflation returned to its 2% target in May for the first time in nearly three years, data showed on Wednesday, but underlying price pressures remained strong, meaning the Bank of England is likely to wait longer before cutting interest rates.
While the fall in headline inflation in May will be welcomed by both Prime Minister Rishi Sunak and the BoE, it is likely to have come too late either to turn around Sunak's fortunes at next month's election or to prompt a BoE rate cut on Thursday.
The Office for National Statistics data showed services price inflation, which the BoE thinks gives a better picture of medium-term inflation risks, was 5.7%, Reuters reported. That was down from 5.9% in April but not as big a drop as the 5.5% economists had forecast in a Reuters poll.
Sterling rose modestly against the US dollar and the euro after the data.
"(BoE) Governor (Andrew) Bailey is likely to be the happiest man in the Square Mile this morning," said Michael Brown, senior research strategist at currency brokers Pepperstone, but added the BoE was likely to wait until August before cutting rates.

The drop in annual consumer price inflation from April's 2.3% reading - in line with economists' expectations - took it to its lowest since July 2021 and marks a sharp decline from the 41-year high of 11.1% in October 2022.

The fall has been sharper than in the euro zone or the United States, where consumer price inflation in May was 2.6% and 3.3% respectively, belying concerns a year ago that British inflation was proving unusually sticky.
Inflation first began to pick up in most Western economies in the second half of 2021 due to bottlenecks from the COVID-19 pandemic, then surged after Russia's full-scale invasion of Ukraine in February 2022 caused natural gas prices to soar.

Consumer prices in Britain are up around 20% over the past three years, squeezing living standards and contributing to the unpopularity of Sunak's Conservatives, who are around 20 points behind the opposition Labour Party in opinion polls.

Sunak said in a video clip that the drop in inflation since he took over from his Conservative predecessor Liz Truss - whose fiscal policy triggered a surge in government borrowing costs - was evidence that his economic policies were working.

"Let's not put all that progress at risk with Labour," he said.

Rachel Reeves, the Labour lawmaker who looks set to be Britain's next finance minister after the July 4 election, said the Conservatives would bring "five more years of chaos".



GACA Reports Significant Growth in Air Travel in Saudi Arabia

GACA Reports Significant Growth in Air Travel in Saudi Arabia
TT

GACA Reports Significant Growth in Air Travel in Saudi Arabia

GACA Reports Significant Growth in Air Travel in Saudi Arabia

Saudi Arabia's General Authority of Civil Aviation (GACA) released air-traffic statistics showing significant growth in the number of passengers and flights in the Kingdom during the first half of 2024 compared to the same period in 2023.

According to the figures, there was a 17% increase in the number of passengers over the past six months, reaching around 62 million, compared to 53 million during the same period last year.

The number of flights also reached approximately 446,000, marking a 12% increase compared to 399,000 flights during the same period last year.

The airfreight volume in the first six months of 2024 witnessed a 41% increase, reaching 606,000 tons compared to 430,000 in the same period of 2023.

During the first half of this year, GACA launched several development projects, including the development and expansion of Prince Mohammad bin Abdulaziz International Airport, the inauguration of the development and expansion of Al-Ahsa International Airport, the launch of the new additional international departure terminal at Taif International Airport, and the introduction of the self-driving air taxi experience for the first time during the Hajj season.

Furthermore, the authority granted the first operating permit for building cleaning using drones, which illustrates its commitment to enabling safe and innovative advanced air mobility solutions. It also launched a knowledge-testing center for aviation personnel and the first phase of electronic gates at King Khalid International Airport in Riyadh.

GACA won two gold awards for Best Customer Service and Best Public Service Center in Europe, the Middle East, and Africa (EMEA) region, the Consumer Protection Association award for excellence in protecting passengers' rights, and the certificate in the quality management system for monitoring flight safety and environmental sustainability.

The aviation sector saw several achievements in the past six months, including 16 Saudi airports obtaining the Airports Council International (ACI) Airport Service Quality (ASQ) accreditation for 2024.

Saudi airports continued their progress in ranking among the top 50 airports worldwide, as announced in the evaluation results of the international air transport rating organization Skytrax. Prince Mohammad bin Abdulaziz International Airport in Madinah won the first-place award as the best regional airport in the Middle East during the Skytrax World Airport Awards ceremony held in Frankfurt, Germany.

The King Abdulaziz International Airport in Jeddah achieved the highest ratings on the Airports Council International list for 2023. The King Fahd International Airport in Dammam won three of the Saudi Airports Awards for 2023, including the award for the best airport in the category 5-15 million passengers, the award for the best customs inspection area, and the award for the best services for people with disabilities.

SAUDIA also received recognition, winning awards for being the most advanced airline in the world and having the best economy-class catering for 2024 in the Skytrax global ranking.

According to Skytrax, Flynas was crowned the fourth-best low-cost airline in the world for the second consecutive year and the first in the Middle East for the seventh consecutive year, the most important global benchmark for measuring airline performance.

All these achievements are part of the initiatives and programs launched by GACA, aiming to contribute to the development of the air transport industry locally, regionally, and internationally, in line with the National Strategy for the Civil Aviation Sector.

The strategy aims to make the aviation sector in the Kingdom the first in the Middle East by reaching 330 million passengers, increasing air freight capacity to 4.5 million tons, and raising air connectivity to reach 250 destinations to and from Saudi airports by 2030.