Heads up: UK CPI report for June coming up later

The article previews the UK June CPI release, highlighting expectations for a slight cooling in inflation. Reuters median forecasts point to headline CPI easing to 2.7% y/y from 2.8%, with core CPI seen at 2.5% y/y from 2.6%. The expected moderation is mainly linked to lower petrol and diesel prices, while core inflation is also projected to soften due to transport services, package holidays, hotels, and potentially weaker airfares. The report is not expected to materially alter the Bank of England outlook, though renewed US-Iran tensions may complicate the inflation and policy backdrop. Traders are currently pricing about 40 bps of BOE rate hikes by year-end, with the first full 25 bps hike not fully priced until November.