By Andy Bruce and William Schomberg (Reuters) -British inflation cooled in May as expected by the Bank of England, which is set to keep interest rates on hold this week while it assesses international energy markets rocked by escalating conflict in the Middle East.

UK inflation eases by less than anticipated ahead of Bank of England rate decision - Inflation in the U.K. dropped modestly in May as a drop in air fares and transport costs were largely offset by rising food prices,

Consumer prices rose 3.4% in May compared with a year earlier, down from the 3.5% of April but still well above the BOE target, with oil price rises threatening to keep inflation higher for longer.