Inflation remains at 2.2% – will interest rates be cut today?

The rate of inflation held at 2.2% during August, official figures show, and the question remains whether interest rates will be cut later.

The Office for National Statistics (ONS) revealed that the consumer prices index (CPI) remains slightly above the Bank of England’s 2% target, with air fares keeping price growth high.

Core CPI, which excludes energy, food, alcohol and tobacco also rose from 3.3% to 3.6% whiles services inflation increased from 5.2% to 5.6%, suggesting pressures remain on personal finances and buyer budgets.

Nathan Emerson, chief executive at agency trade body Propertymark, said:

“The positive news is that inflation remains broadly in line with the Bank of England’s target of two per cent, which means that people shouldn’t witness the uncertainty and rapid price rises experienced in 2022 and 2023. 

“Although a further drop in inflation would have of course been welcome news, Propertymark hopes the Bank of England feels in a strong enough position to consider a further cut in interest rates.

“The combination of inflation sitting within bounds and any further cuts in base rate over the coming months has the potential to bring a new wave of confidence and affordability within the housing market.

“However, most importantly, it brings much welcome relief and financial flexibility to many households compared to only six months ago.”

Kindly shared by Estate Agent Today