Are prices going up or down?

Prices are almost always rising — the key question is how quickly.

Inflation measures the rate of price increases across hundreds of goods and services.

The ONS reported that in the year to October 2025:

  • Inflation dipped to 3.6%, down from 3.8% the previous month.
  • This is far below the peak of 11.1% in October 2022, but still above the Bank of England’s 2% target.

So prices are still going up — just not as quickly.

Why the weekly shop still feels expensive

Food inflation remains a major concern.

Recent data shows:

  • Fish, vegetables, chocolate and confectionery have increased in price.
  • Fruit prices fell slightly.
  • Staples such as bread, meat and potatoes cost more than even a month ago.

Research by the Bank of England suggests people are still buying roughly the same amount of food — but paying more for it.

Households are adjusting by:

  • Buying more vegetables
  • Reducing meat consumption
  • Changing brands or shopping patterns

Concerns about food and utility bills remain front of mind for many families.

Why this could help mortgage borrowers

Lower inflation strengthens the case for the Bank of England to cut interest rates again.

The Bank uses its base rate to try to bring inflation back to 2%. If inflation continues to ease, further cuts may follow.

Markets are now anticipating the possibility of another interest rate reduction in December.

Mortgage rates are already moving

Even before any official decision:

  • Many major lenders have reduced fixed mortgage rates in recent weeks.
  • The average new two-year fixed rate is now 4.88%.
  • The average five-year fixed rate stands at 4.93%.

According to financial data provider Moneyfacts:

  • Rates for buyers with 5% or 10% deposits — often first-time buyers — are now at their lowest levels in two to three years.

Lenders may also be adjusting pricing ahead of the typically quieter Christmas housing period to stimulate demand.

But savers may not benefit as much

While mortgage competition has increased, savings rates have not seen the same intensity of competition.

Moneyfacts notes that savings rate competition has been limited in recent weeks.

The Budget adds uncertainty

Chancellor Rachel Reeves’ Budget on 26 November is also weighing on decisions.

Potential measures affecting:

  • Property taxation
  • Economic growth
  • Public spending

…could influence both household budgets and borrowing costs.

Government policy must balance reducing inflation with meeting fiscal targets — and that balancing act affects:

  • Supermarket spending
  • Mortgage affordability
  • Saving behaviour
  • Housing market activity

What this means for you

If you are:

  • Coming to the end of a fixed-rate mortgage
  • Considering buying
  • Watching rates before making a move

A dip in inflation improves the chances of lower borrowing costs — but nothing is guaranteed.

Food and household bills may still feel tight, even if mortgage rates edge lower.

This article provides general information, not personal advice. What’s suitable depends on your personal circumstances.

Want to see how rates compare?

If you’d like to explore what mortgage rates are currently available based on your situation, you can request a mortgage quote to explore options.

(Requesting a quote provides information only — it is not financial advice or a recommendation.)