Just Mortgages comments on CPI Inflation

19 February 2025

John Phillips, CEO of Just Mortgages and Spicerhaart, said:

“Following a surprise drop last month, inflation has surprised once again, coming in higher than many markets and analysts had expected. Alongside upward pressures on food and transport, a key factor was education as private schools became subject to VAT in January and passed this on in higher fees.

“We have to be realistic and acknowledge that inflation is likely to remain a persistent challenge this year, particularly with geopolitical tensions escalating, higher energy prices later in the year and as we see the full effects of government policy, such as the national insurance hike. We also have the elephant in the room and the upcoming Spring Statement at the end of March.

“All along though, the central bank has maintained that it will push forward with multiple base rate cuts this year, as it balances sticky inflation with an economy showing minimal growth. Whether today’s bigger rise in inflation changes that trajectory is yet to be seen.

“From our perspective, January proved to be a positive month and this has continued into February with consistent levels of buyer registrations and demand for both valuations and adviser appointments. Customers have responded well to positive changes in the market with the base rate cut and both pre-emptive and subsequent cuts from lenders. While it is important to keep inflation under control, our hope is we do see further base rate cuts this year to maintain this positive momentum and allow the housing market to play its important role in driving economic growth.”