September's inflation reading shows a degree of stability, holding at 3.8% for the third consecutive month

Although September’s inflation reading shows a degree of stability over the past few months, it will probably not be enough to persuade the Monetary Policy Committee (MPC) to reduce borrowing costs again this year. Policymakers will want to see clear evidence that inflation is heading back towards their 2% target before acting, which means another rate cut this year remains unlikely.

That’s a blow for borrowers hoping for mortgage rates to come down further. As for savers, the best course of action now is to shop around for the best possible deals to ensure that their money is working as hard as it could be or consider longer-term investments that can often offer stronger protection against inflation.

And, with speculation that the annual Cash ISA allowance could be cut to £10,000, savers may soon find their tax-free shelter shrinking, only reinforcing the importance of reviewing investment options beyond cash savings.

For many UK households though, the recovery still feels fragile. Rising living costs and higher borrowing rates continue to squeeze disposable incomes. Families need to see growth translate into lower inflation and greater financial stability before they can feel the benefits in their day-to-day lives.