Molo Finance comment on inflation: "stability is now key"

16 October 2024

Mark Michaelides, chief commercial officer at Molo Finance, the digital buy-to-let lender and ColCap company, said: “This will be very welcome news for businesses and consumers – and no doubt for the Government in the run up to the Budget. The drop in services rate of inflation from 5.6% to 4.9% will be especially encouraging for the Bank of England.

“Yesterday’s ONS figures already provided some clue, as wage growth eased - falling to 4.9% in the three months to August - sparking further anticipation among some analysts of a November Bank Rate cut. However, there are still some indications that inflation may creep higher into year end, so we'll need to keep a close eye on that.

“Now that headline inflation is more or less where it needs to be, stability from here is the key in settling some of the recent swap rate volatility, which in turn will result in more stable mortgage rates. It is worth pointing out, though, that stable mortgage rates do not necessarily equate to low mortgage rates in the sense that we do not expect a return in the near-term to pre-Truss Budget mortgage rates.”