Santander Monthly Mortgage Market View - Frances Haque, Chief Economist at Santander UK responds to today's inflation data

16 April 2025

Frances Haque, Chief Economist at Santander UK comments:

"This morning’s data on inflation will be warmly greeted by many homeowners given the likely impact on SWAP and Bank Rate, but for some, it will continue to be overshadowed by the uncertainty around global tariffs and implications for the UK economy.

"CPI grew by 2.6% in March, down from 2.8% in February - below consensus, and more importantly, the Bank of England’s forecast. Although markets are already expecting a further cut to Bank Rate in May, this will help provide support for that. As we move forward, inflation will inevitably rise again given the increases in household bills that April brought, however, the impact of US tariffs on inflation is proving a little trickier to predict with the potential for effects to swing both ways.

“April’s stamp duty deadline sparked a new lease of life into the housing market, with our data showing a 200% increase in completions in March year-on-year. We continue to forecast a base rate cut at the next meeting and two further rate cuts during the remainder of the year – enabling the Bank of England to strike a balance between supporting growth in a time of economic uncertainty and containing inflation."