The UK rate of inflation fell to 3.2% in March, down from 3.4% in February, and reaching its lowest level since September 2021.
Although the drop was slightly less than expected, it will still come as welcome news to households, and is predicted to drop further in April as the lower energy price cap takes effect.
The Office of National Statistics (ONS) said the biggest contribution to the change in inflation came from food, with prices rising by less than a year ago. However that was partially offset by petrol and diesel prices which saw bigger increases.
What does this mean for my mortgage?
The Bank of England will meet again on the 9th May, and while it is not expected to drop interest rates at that point, some economists feel that the first rate cut could come in June.
Bear in mind that these are only predictions and no-one knows for certain what will happen to interest rates in the coming months.
If you’re coming to the end of your mortgage deal over the next few months, it’s a good idea to start reviewing your options as soon as possible. You can typically secure a mortgage up to 6 months before your current deal is due to finish, and this will give you time to keep an eye on what’s happening in the market.
If rates improve in the meantime, you can look to switch, but it also means you have the peace of mind that you already have a deal in place if rates do start to tick up.
