Inflation dropped sharply in the year to April last week, yet brokers have cautioned borrowers against assuming mortgage rates will continue to fall in the coming weeks and months, with one describing the steeper-than-anticipated decline in inflation as “a wolf in sheep’s clothing” and another calling it a “mirage”.

Inflation tumbled more than forecast to 2.8% in the 12 months to April, down from 3.3% in the year to March, owing to the lower energy price cap, which offset the impact of rising fuel costs triggered by turmoil in the Middle East. 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 Office for National Statistics, 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.”

Nevertheless, Mr Fitzner highlighted that elevated crude oil and petrol prices are pushing the cost of both raw materials and factory goods upwards.

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, echoed those concerns: “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.”

Hannah Vandervennin, director of The Mortgage Consultancy, said: “Today’s inflation number is welcome, but a chunk of the fall was driven by the energy support package and base effects. Both are temporary and oil is going the wrong way.

“The cost of borrowers waiting for the perfect moment isn’t a slightly worse deal. It’s the deal you didn’t do, the property you didn’t buy and the remortgage you kept putting off until your fix ran out and you rolled onto your lender’s standard variable rate by default. Look at your actual situation, make a decision and move forward.”

Rob Mansfield, Independent Financial Advisor at Tonbridge-based Rootes Wealth Management, noted that “falling inflation sounds positive, but prices often lag world events”.

He went on to warn: “With the sustained conflict in the Middle East, prices are more likely to rise in the months ahead, so this could be a mirage in the desert on a bumpy road that is inflation.”

Justin Moy, managing director at Chelmsford-based EHF Mortgages, cautioned that “borrowers need to understand how this anomaly in the inflation rate has occurred, and that the full effects of the Middle East conflict don’t yet show in these numbers”. He added: “Lenders and the markets are already braced for what the next few months will look like and, as mortgage rates are priced on future costs, significant rate cuts are definitely not on the horizon.”

Eamonn Prendergast, Chartered Financial Adviser at Bromley-based Palantir Financial Planning, urged savers not to become complacent simply because inflation had eased.

He warned: “Inflation is the silent erosion of wealth and, even at these levels, it continues to reduce purchasing power over time. Many people focus on nominal returns, especially on cash, but the real return after inflation is what truly matters.

“If your savings are earning 3–4% but inflation is close behind, the real gain is minimal. Over time, that can significantly impact long-term financial plans. The key is not reacting to one month’s figure, but ensuring your strategy is built to protect and grow wealth in real terms.”