UK Inflation Falls, But Relief Will Probably be Short Lived

UK inflation dropped to 2.6% in June, down from 2.8% in May, making it the lowest rate since March 2025. However, experts don’t think it’s going to last. 

The drop most likely comes thanks to the fall in fuel prices as a consequence of a shaky truce in the war between the USA and Iran. Unfortunately, this truce has already been shattered, with the conflict recently escalating again, causing analysts to predict that the price of fuel will almost certainly rise soon, and the National Institute of Economic and Social Research claims we can expect the inflation rate to worsen as the year progresses. 

Inflation at 2.6% means there has been a decrease in price for foods like sugar, margarine and pizza, but it has done nothing to help mortgage rates. Head of personal finance at AJ Bell, Sarah Coles advises: “it’s not worth hanging on for rates to hit a magic number… if you have a remortgage due in the next six months, check if you can agree a deal for your remortgage now.”

Written by Jorja Flitcroft