Inflation fell more than expected to 2.8% in the 12 months to April, down from 3.3% in the year to March, due to the lower energy price cap, which counteracted the impact of rising fuel prices triggered by events in the Middle East.
However, brokers have warned borrowers against thinking mortgage rates will be heading further down in the weeks and months ahead.
The Consumer Prices Index (CPI) rose by 2.8% in the 12 months to April 2026, down from 3.3% in the 12 months to March. On a monthly basis, CPI rose by 0.7% in April 2026, compared with a rise of 1.2% in April 2025.
Grant Fitzner, Chief Economist at the ONS, said there was "a notable fall in annual inflation led by lower electricity and gas prices." He continued: "This was due to the Government's energy bill support package reducing variable and fixed tariffs, along with lower global wholesale energy prices before the conflict in the Middle East, which fed through to the reduction in the Ofgem cap." However, Fitzner noted that higher crude oil and petrol prices are sending the price of both raw materials and goods leaving factories north.
Speaking to Newspage, Shaun Sturgess, Director at Swansea-based Sturgess Mortgage Solutions, said: "This data could be a wolf in sheep's clothing for borrowers. There is a chance that borrowers will see the headline figure showing inflation is falling and believe that rates could soon be coming down. The reality is that this data is masking the full impact of the fuel crisis caused by events in the Middle East and that inflation could rise sharply over the summer, especially if the conflict intensifies. That could send rates higher rather than, as this data may make people think, lower."
Philly Ponniah, Chartered Wealth Manager and Financial Coach at Philly Financial, agreed: "This drop in inflation will feel like welcome relief for borrowers, but I’d be careful about treating it as a true turning point. Much of the fall came from temporary energy effects and we still haven’t fully seen the impact of higher oil prices and Middle East tensions feed through into the wider economy. If inflation starts climbing again over the summer, expectations around future rate cuts could change very quickly. For borrowers, that creates a real risk. Some people may delay fixing their mortgage or refinancing because they expect cheaper deals ahead, only to find rates move higher again if inflation stays stubborn. Waiting for the 'perfect' rate can sometimes cost more than securing certainty. For savers, lower inflation is positive because cash savings are no longer losing value as quickly, but it’s still important to review rates regularly rather than assuming today’s returns will last."
