UK inflation has fallen back to 3.4%, the lowest level in more than two and a half years, boosting hopes that the Bank of England could look to cut interest rates.
The Bank has been forced to repeatedly increase rates to try to control inflation over the past couple of years, driving up mortgage repayments for millions.
But some economists think it may start cutting them in the near term, much earlier than previously forecast, and that is a position supported by many of those working in the property industry, including Nathan Emerson, CEO of Propertymark.
He said: “This is an ideal time for the Bank of England to start considering a cut in interest rates when they meet this month. Andrew Bailey, the Governor of the Bank of England, said recently that inflation does not have to fall to 2 per cent before the central bank starts considering cutting interest rates. Propertymark’s own Housing Insight Report shows that there has been an average 120 per cent increase in the number of potential buyers registered per member branch and this is potentially an ideal time to revitalise the housing market.”
Despite the sharp drop in inflation, the Bank of England is expected to keep interest rates at the same level today as it continues to wait for further evidence that inflation is falling.
Financial markets are predicting that the base rate will remain unchanged at 5.25% for the fifth consecutive time.
Last month, Andrew Bailey, the BoE’s governor, told the Treasury Select Committee: “We don’t need inflation to come back to target before we cut interest rates, I must be very clear on that, that’s not necessary.
“We’ll be looking for sustained progress on those things to reach that judgment about how long this period of restrictive policy needs to be.”
Fall in inflation….so prices are getting even higher, just more slowly 🙁
And….we all know people who are going to be voting for 5 more years of this government, that is probably the most depressing part
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I was a Labour party member
I cannot vote for a party that supports Hamas and whose Jewish MPs have a to have a police guard on their homes
Many Labour members are pure scum sadly
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