UK inflation unchanged in May as cost of living remains high

The UK's inflation rate was higher than expected in May as prices for flying abroad, buying second-hand cars and going to live music events all rose official figures show.

Prices continued to rise by 8.7% in the year to May, the same rate as in April.

Markets and economists had expected inflation to fall slightly.

With prices continuing to rise fast, the Bank of England is widely expected to raise interest rates on Thursday in a bid to slow them.

Part of the Bank's job is to keep inflation at a target rate of 2% - far lower than the current rate.

It has been steadily raising interest rates, which make the cost of borrowing money more expensive, in response to consumer prices soaring.

It has led to concerns over loans, particularly mortgages, with homeowners facing large increases in repayments when fixed-term deals come to an end.

In response to inflation remaining at a high level, Chancellor Jeremy Hunt said the government would "not hesitate" in its resolve to support the Bank, which is an independent institution, as it "seeks to squeeze inflation out of our economy".