We’ve had two months of inflation at the headline 2%, raising hopes there may be an interest rate cut in August.
But the decision on whether to cut the interest rate from its 16-year high of 5.25% next month still hangs in the balance.
The Bank of England policy makers have concerns around service sector inflation and wage growth.
Price rises in the service sector remain unchanged at 5.7% and wage growth has dipped just slightly from 6% to 5.7%. Some economists think this could mean we won’t see a rate cut until September at the earliest.
However, there has been a glimmer of hope for homebuyers as fixed-rate mortgages are available at below 4%, for the first time since February.
Nationwide Building Society has cut rates by up to 0.25% across its two-, three- and five-year fixed rate deals. It will be offering a five-year fix at 3.99% for new customers buying a home with a 40% deposit. Re-mortgagers will need to wait a bit longer for lower rates.
Other lenders including HSBC and Halifax have been reducing rates too which the industry hopes is the start of some healthy competition and more appealing mortgage deals coming to the market.