Inflation falling back to zero should lead to a further boost in consumer spending throughout the rest of the year, according to industry commentators.
Housebuilders' shares have taken a dive in early afternoon trading after Bank of England governor Mark Carney said a hike in interest rates is "moving closer".
UK CPI inflation fell back to zero last month, down from 0.1% in May, as the prices of clothing, fuel and food all fell.
The managers of the Ruffer investment company have warned that markets and banks are unprepared for a future crisis, while investors are facing higher risks than ever before as liquidity dries up.
Sterling jumped 0.6% against the US dollar this morning, on the news wages in the UK grew at their fastest rate since 2001 in the three months to the end of April.
The month of May marked the end of the UK's brief spell of negative inflation, as rising fuel costs have pushed the CPI figure above the zero mark once again.
Cazenove Capital CIO Richard Jeffrey examines the scenarios with the greatest 'potential to sting' fixed income investors.
A rise in inflation expectations is prompting more fund managers to seek ways to protect their portfolios, despite headline price indices sitting at ultra-low levels.
The International Monetary Fund has urged policymakers in the US to delay hiking interest rates or face a further bout of "financial instability".
The sell-off in European government bonds has spilled over into equities once again on Thursday, with UK stocks unable to escape the pain.