Mortgage borrowers who had been holding out for more affordable rates had their hopes dashed last week, as disappointing economic data raised the likelihood of borrowing costs staying higher for longer.
A drop in the annual rate of inflation to 3.2% in March fell only just short of City expectations for a drop to 3.1%, but that was enough to prompt investors to trim their bets on an imminent cut to interest rates. Financial markets, which had until recently been pricing in a first interest rate cut by the Bank of England in June, are now forecasting that the first reduction may not come until September or November.
