After a three-year saga, inflation has finally returned to the Bank of England’s target. The Office for National Statistics reports this morning that the inflation rate slowed to 2 per cent in the 12 months to May 2024: its lowest point since July 2021.

The greatest contribution came from another slowdown in food and non-alcoholic beverages: having once peaked at a staggering 19.1 per cent in 2023, prices have now slowed to 1.7 per cent in the year to May, down from 2.9 per cent in the year to April.

It’s a painful reminder of what triggered an early election in the first place

Clothing and footwear also played a role, slowing to 3 per cent in the year to May, down from 3.7 per cent in April. Some of this was off-set by rising transport costs, largely thanks to a rise in motor fuel duty, which saw the division rise by 0.3 per cent in the year to May. But core inflation (which removes more volatile prices like food and energy) still shows a positive trajectory, slowing from 3.9 per cent in April down to 3.5 per cent in May.

Is the return to target a (rare) piece of good news for Rishi Sunak and his MPs? Many in the Tory camp will argue that isn’t even a question: it’s the one priority Sunak announced when he entered Downing Street that has been delivered – and despite politicians having very little control over whether the inflation rate goes up or down (that’s largely down to money supply and interest rates, controlled by the Bank of England), the simple fact that the fight against spiralling inflation has been brought to an end under this government is a win for the Conservatives.

But the return to target is also a painful reminder of what triggered an early election in the first place. Sunak used the good inflation data (and higher-than-expected growth data) from last month to spring into a campaign, insisting that the ‘plan and priorities’ that he ‘set out are working.’ It was supposed to distract from what hadn’t been delivered: specifically his pledge to ‘stop the boats’ which looked more precarious going into the summer, with the number of people arriving across the Channel set to rise, while doubts were also rising about whether flights to Rwanda would really take off.

But if the strategy relies on the economy ‘turning the corner’, as ministers like to say, the public needs to experience this for themselves. Far more compelling to allow people a bit of time to feel the benefits – something that might have started to happen had the Prime Minister waited until the autumn to go to the polls.

It’s a hard argument to make even with more positive data these days, as living standards have still not recovered to their pre-pandemic levels. ‘I’m not going to claim everything is fine,’ shadow chancellor Rachel Reeves said on the media round this morning. It’s not really a point that the Tories dispute – they are careful not to exaggerate or oversell the success of getting inflation under control. But it means there are restraints on how hard they can push their core election message. Of course if you are having to tell people that they are better off than they were six months or a year ago, you are already on the back foot.

A slightly longer timeline might have also allowed for at least one interest rate cut, which is not expected to happen tomorrow when we get the next announcement on rates from the Monetary Policy Committee. As Capital Economics notes this morning, the ‘big disappointment for the Bank’ in today’s inflation release will be that ‘services inflation only nudged down from 5.9 per cent to 5.7 per cent)’ – the expectation was for a greater slowdown. The forecaster says ‘today’s release won’t alleviate the Bank’s concerns about persistent price pressures entirely’ further reducing the (already low) chances of an interest rate cut tomorrow.

Those expectations dropped even further when Sunak called the election. It would be very surprising if the Bank were to start its rate-cutting process during an election, given its fears of being seen to act politically in any way. But rate cuts are not thought to be too far off, either. And whoever is in power when the process starts is likely to get the credit.