Falling inflation and real wages, should put more borrowers on a better footing - Comment on the latest ONS inflation figure from Adam Oldfield at Phoebus Software
Adam Oldfield, chief revenue officer at Phoebus Software, says “Bringing inflation down was the intent from the Bank of England when it first started increasing the bank base rate and we are, at last, getting to see the impact. Today’s headline figure will no doubt be one that gives a level of confidence to many. Nonetheless, the headline that inflation is coming down is great, but it does still mean prices are rising over double the amount that government is happy with.
“On the flip side wages are out pacing inflation, which should put more borrowers on a better footing. However, we saw last week that arrears continue to increase, and the governor has already stated that the base rate won’t be coming down any time soon, even if inflation continues to fall. So, next week’s budget is a huge opportunity for the Chancellor to step in and bring some much-needed help to a housing market that should be contributing massively to the UK economy. How far he will go and what impact anything he does introduce will have, is up for debate. We have seen too many times how successive governments use the UK’s appetite for home ownership as a bargaining tool as we get closer to a general election. Will this government be any different?
Published: 15 November 2023