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Inflation falls to 2.8% - savers, borrowers and investors

ended 26. March 2025

The Consumer Prices Index (CPI) rose by 2.8% in the 12 months to February 2025, down from 3.0% in the 12 months to January, according to official data published this morning. On a monthly basis, CPI rose by 0.4% in February 2025, compared with a rise of 0.6% in February 2024. Newspage asked IFAs and mortgage brokers what this could mean for savers, borrowers and how it might impact demand for property (and the wider property market)? Their views will appear below until 08:15.

6 responses from the Newspage community

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Riz MalikVerified
Independent Financial Adviser at R3 Wealth
Cash returns especially for high rate tax payers still struggle to keep up with inflation. However, many households are still overweight in cash with no immediate spending requirements. If you are overweight in cash you should consider your options in attempt to keep decent real returns.
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Emma JonesVerified
Managing Director at Whenthebanksaysno.co.uk
Inflation dipping below 3% could provide a boost to borrowers if it translates into lower interest — and mortgage — rates. Unfortunately, the road ahead is unlikely to be a smooth one and there is every chance inflation could rise again as the effects of the Budget kick in. This is a small win for borrowers either way.
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Ben PerksVerified
Managing Director at Orchard Financial Advisers
That tiny little dip under 3% could have a butterfly effect on the mortgage rates available to borrowers. Whenever we see a dip it sends shockwaves of confidence through the markets, which in turn can provide better borrowing opportunities. Don’t get too comfy, though, as we’ve seen inflation jiggle up and down over the past few years.
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Iain SwattonVerified
Director at Exemplar Financial Services
Today’s drop in inflation to 2.8% is good news on the day the government announces its Spring Statement. No doubt they’ll use it as evidence that they’re steering the economy in the right direction – although whether that carries credibility, we wait and see. For borrowers, it’s a glimmer of hope that borrowing costs may ease in the future, offering much-needed relief to homeowners and those looking to remortgage. With inflation edging closer to the Bank of England’s 2% target, the prospect of rate cuts feels more realistic, which could breathe fresh life into the housing market.
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Justin MoyVerified
Managing Director at EHF Mortgages
Headline inflation is broadly in line with expectation so it’s unlikely this reduction will create any significant movement in mortgage or savings rates. There will be greater impact on mortgage pricing from the Chancellor’s Spring Statement, and how money markets react to future growth expectations announced later today.
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Stephen PerkinsVerified
Managing Director at Yellow Brick Mortgages
The drop in inflation is encouraging until you look ahead at all the forthcoming pressures on the economy from April which will lead to certain increases in inflation over the coming months. Lenders will take a balanced medium term view and therefore don’t expect any sweeping rate reductions on the back of today’s inflation print.