The governor of the Bank of England has instructed MPs that rates of interest could not rise a lot additional amid expectations that inflation is ready to fall "markedly" by the top of the yr.
Andrew Bailey stated charges have been "much nearer now to the top of the cycle" following a 14th consecutive hike - to 5.25% - last month.
His feedback will give some hope to householders and the broader housing market, which has experienced a slump in recent months amid high mortgage rates.
Speaking to the Commons Treasury Committee on Wednesday, the governor additionally reiterated his prediction that inflation is prone to be down considerably this winter.
But he additionally cautioned that it might quickly "tick up" following the increase in petrol prices in August and amid concerns over the rising cost of oil.
Mr Bailey instructed MPs that whereas there had beforehand been a interval when "it was clear that rates needed to rise", the Bank was "not in that place anymore".
He added: "judgements now are much finer... I think we are much nearer now to the top of the cycle.
"And I'm not due to this fact saying we're on the high of the cycle, as a result of we have a gathering to return, however I feel we're a lot nearer to it, on interest rates, on the idea of present proof."
Most economists count on the Bank to lift rates of interest for a fifteenth time in a row to five.5% later this month, and predict charges to peak at 5.75%, based on a ballot.
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On inflation, the governor instructed MPs: "Many of the indicators are now moving as we would expect them to move, and are signalling that the fall in inflation will continue and, as I've said a number of times, I think [it] will be quite marked by the end of this year.
"I ought to say probably that we'll get a tick up within the subsequent launch as a result of gas costs went down in August final yrand went up a bit in August this yr... however I do not [see] that as a central change within the path."
The pound slumped to near a three-month low against the US dollar - to around $1.24 - following his comments about inflation falling, which echoed similar remarks by Chancellor Jeremy Hunt at the weekend.
Mr Hunt warned inflation may soon hit a "blip" - but in addition added he was still confident it would be halved as promised by the end of 2023.
Mr Bailey was additionally quizzed a couple of Sky News interview with the Bank's former chief economist Andy Haldane, in which he accused the institution of helping to fuel inflation.
Mr Haldane stated the Bank had printed cash by way of quantitative easing to assist the economic system after COVID for "longer than it needed to" and likewise recommended it had acted too slowly to extend rates of interest.
The governor careworn that his former colleague had made his feedback "with hindsight" and stated: "I don't enter into those judgements because I think it is very difficult to separate out the hindsight judgement from the decision at the time".
But, commenting on the "last phase" of quantitative easing to help the economic system following COVID, he stated: "I think most of the people who give evidence on this say they don't think actually it made a major contribution to inflation".
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