Government · UK · Office for National Statistics
UK inflation slows to 2.8% as services cool to 3.2%
UK CPI inflation eased to 2.8% in April 2026 from 3.3% in March, with services inflation falling sharply from 4.5% to 3.2%. Core CPI hit 2.5%, the lowest since July 2021.
Source published Summarised
Key findings at a glance
- 2.8% UK CPI 12-month rate in April 2026, down from 3.3% in March and the lowest since March 2025.
- 3.0% UK CPIH 12-month rate in April 2026, down from 3.4% in March.
- 2.5% Core CPI annual rate (excluding energy, food, alcohol, tobacco), down from 3.1% and the lowest since July 2021.
- 3.2% CPI services annual rate, sharp fall from 4.5% in March 2026 and the largest single-month decline in the services basket since 2023.
- 2.4% CPI goods annual rate, up from 2.1% in March 2026, reversing the disinflation trend in physical goods.
- 8.4% Annual fall in UK electricity prices in April 2026, following the Ofgem price cap reduction from 1 April.
- £117 Average annual reduction in dual-fuel direct debit energy bills under the new Ofgem price cap (Q2 2026).
- 3.0% Food and non-alcoholic beverages annual rate in April 2026, down from 3.7% in March.
- 4.4% Restaurants and hotels annual rate in April 2026, up from 4.0% in March, the highest in the services basket.
- 4.5% Communication services annual rate, up from 4.1% in March 2026, reflecting continued telco price increases.
- 5.1% Education annual rate in April 2026, the highest of any CPIH division and unchanged from March.
- 1.7% Recreation and culture annual rate, down from 2.8% in March 2026, the lowest reading in this division in over a year.
What the report covers
The Office for National Statistics released its monthly Consumer price inflation, UK bulletin for April 2026 on 20 May. The release covers the Consumer Prices Index (CPI), the Consumer Prices Index including owner occupiers' housing costs (CPIH), Retail Prices Index (RPI), and the core measures that strip out energy, food, alcohol and tobacco. Coverage is the full UK across 12 expenditure divisions: food, alcohol and tobacco, clothing, housing and household services, furniture, health, transport, communication, recreation, education, restaurants and hotels, and miscellaneous goods and services.
April 2026 figures show CPI at 2.8% (down from 3.3%) and CPIH at 3.0% (down from 3.4%). Housing and household services made the largest downward contribution, driven by an 8.4% annual fall in electricity prices following the April Ofgem price cap reduction. Transport pulled in the other direction, lifted by the highest motor fuel inflation since September 2022. UK CPI fell below Germany's flash estimate of 2.9% for the first time since December 2024.
For UK marketers, the headline matters less than the composition. The big move is the rapid cooling of services inflation, which has been the stubborn part of the basket since 2022 and is the input the Bank of England watches most closely for rate decisions. With services inflation at 3.2% and core CPI at 2.5%, the case for further rate cuts firms up, which feeds directly through to financing, credit availability, and consumer ad-response over the next two quarters.
What this means for UK marketers
The April figures change three things for UK marketers planning the next two quarters.
1. Services-sector ad budgets get room to expand. Services inflation falling from 4.5% to 3.2% means service businesses are no longer passing through accelerating cost pressure into prices. That eases pressure on margins and frees up media budget headroom, particularly for hospitality and personal services brands. Cost-per-acquisition targets that have been creeping up since 2022 can credibly be revisited. If you run Google Ads for a UK service business, this is the data point to lean on in client budget reviews this quarter.
2. Goods retailers face the opposite trajectory. Goods inflation has reversed from 2.1% to 2.4% and looks set to keep climbing as motor fuel inflation hits a three-year high and clothing and footwear flips positive. Ecommerce brands selling physical goods should expect renewed cost pass-through over Q2 and Q3, meaning higher unit prices, more friction at checkout, and rising importance of margin-protective creative (bundle value, free delivery thresholds, finance options). The cost-of-living context from our earlier ONS public opinions report still applies: 79% of UK adults report rising living costs, so price-led messaging needs to be precise rather than generic.
3. The Bank of England rate-cut path is the real lead indicator. Core CPI at 2.5%, the lowest since July 2021, gives the MPC clearer cover to cut at the next decision. Lower base rates compress consumer credit costs (Klarna, Clearpay, finance plans), reduce mortgage payments freeing up household disposable income, and make growth-stage advertising on Meta and Google more attractive on lifetime-value maths. Combined with the cooling labour market documented in our May labour market report, the macro backdrop is shifting from a cost-of-living defensive posture to a slow stimulus posture. Marketing plans for H2 2026 should reflect that.
One sector-specific watchpoint: communication inflation rose to 4.5% in April. UK telcos, broadband and mobile providers are still pushing through above-headline price increases. Brands in that space should expect higher churn signals and plan retention-led creative accordingly, while challengers can credibly position on price.
How they got the data
The ONS produces CPI and CPIH from a representative basket of around 730 items, with around 25,000 prices collected manually each month by field price collectors at around 140 locations across the UK. Since February 2026, that has been supplemented by approximately 300 million scanner data points per month covering roughly half of the UK grocery market, sourced directly from supermarket scanners at the checkout and online. Items are aggregated into "consumption segments" then weighted by household expenditure shares (updated annually) and chained to a 2015 base year.
CPI is produced on a harmonised methodology developed by Eurostat, allowing direct comparison with EU member states, and is the measure used to set the Bank of England's operational inflation target. CPIH adds owner occupiers' housing costs (around 18% of the basket) and is the ONS's most comprehensive consumer inflation measure. The ONS Consumer Prices Indices Technical Manual covers the full methodology.
Government · UK
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From Office for National Statistics · published 20/05/2026