What happened
Official figures show United Kingdom consumer prices rose by 2.8 percent in the year to May, unchanged from April. Economists expect inflation to climb back toward 3.5 percent by the end of the year as higher energy costs feed through.
Why it matters
Inflation measures how quickly the cost of everyday goods and services is rising. A move back toward 3.5 percent means household budgets face renewed pressure and makes it harder for the Bank of England to cut interest rates.
Explained simply
Picture your weekly shop as a basket of the same items every week. Inflation is how much more you pay this year for that identical basket. Right now the basket costs about 2.8 percent more than a year ago, and forecasters warn that a jump in energy bills will make it noticeably pricier by winter.
What it means for you
Higher inflation erodes the real value of cash savings, so check that your savings account or Cash ISA pays a rate above 2.8 percent. Fixing your energy tariff and reviewing your budget now can help cushion the rise expected later this year.
