If you are looking at investment planning in Cheshire or the wider UK economy, a degree of calm has returned to the FTSE 100 index following the global sell-off that spooked the markets earlier this month.
This has been buoyed by gains in Asia and Wall Street, stabilising sentiment as fears ease of a recession across the Atlantic. So far this year, the FTSE (Financial Times Stock Exchange) 100 is up just over 6%.
One potential fly in the ointment is the increase in UK private rents that rose by 8.6%, a figure which, despite being below the 9.3% recorded last March, could still be problematic for the property market, as renters fail to save the funds needed to pay down a deposit on a new home.
This month’s inflation data, however, showed that prices rose slower than anticipated last month, which may boost the prospect for further rate cuts and spell good news for the housing market.
According to the Office for National Statistics (ONS), consumer price inflation went up to 2.2% after two months at the BoE’s (Bank of England) 2% target, representing a marginally smaller increase than economists predicted. The closely monitored services inflation subsided from 5.7% to 5.2% from June to July, as consumer prices overall rose slightly from 2% to 2.2%.
While this data may not entirely offset the Bank’s concerns about lingering price pressures, analysts have said there is scope for a further interest rate cut at the next MPC (Monetary Policy Committee) meeting, bolstering the view that inflation and interest rates will fall next year.
