Markets Rally As US-Iran Ceasefire Sparks British Mortgage Rate Relief
Key Takeaways
- Two-week US-Iran ceasefire triggers global market rally.
- UK mortgage rates expected to fall amid ceasefire relief.
- Oil prices fall sharply as ceasefire eases regional tension.
Ceasefire Calms Markets
City traders cut forecasts for UK interest rate rises after a two-week ceasefire.
Money markets fully price only one Bank of England hike by December, down from two.
Brent crude plunged 13.3% as supply concerns eased.
The FTSE 100 surged 3.09%.
MortgageProfessionalAmerica noted it was too early to tell if consumer confidence would improve.
Mortgage Rates React
Mortgage lenders began responding to the shifting outlook.
The lowest fixed-rate deals had risen more than 1 percentage point since the war started.
1.8 million remortgagees could be affected in 2026.
The crowding out of buyers by mortgage cost inflation remains the biggest obstacle to healthy turnover.
Economic Uncertainty
The UK economic outlook remains clouded by inflation pressures and higher interest rates.
The Halifax house price index fell 0.5% in March.
Borrowing costs remain the biggest challenge for new buyers.
The OBR's growth forecast is now likely obsolete.
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