The Consumer Prices Index (CPI) was unchanged in the year to March 2015, that is, a 12-month rate of 0.0%, as in the year to February 2015.

Falls in clothing and gas prices produced the largest downward contributions to change in the inflation rate. These were offset by a rise in the price of motor fuels and smaller upward contributions from a variety of other products such as food.

David Whittaker, managing director of Mortgages for Business, said: “We have entered completely uncharted economic waters – whether or not the UK is in outright deflation right now in April. There will be massive implications for the world of mortgages.

“Counter-intuitive effects are already on the cards. Lower consumer price inflation could actually boost house price growth, as long-term borrowing costs fall and in turn mortgage rates improve even further. Already, record-low mortgage rates have been a stimulant for the property market. So if this potent diet continues then cooling house prices are more likely to pick up again.

“The effects are also far from uniform, and will stimulate remortgaging and buy-to-let more than high-LTV consumer loans. Buy-to-let lending is the only area that saw year-on-year growth in February according to the CML’s figures this morning. And since then we have seen more growth in interest from landlords. Buy-to-let will be a clear winner from this brave new world.

“Yet beneath all of this morning’s economic data looms a political stability that is about to be shaken to the foundations by the most uncertain general election in a generation.

“In as little as three weeks’ time we may not have a workable majority of any kind in the House of Commons. The last few weeks have already thrown jitters through the gilt markets, and interest rate swaps have halted their downward trend. Very soon, the emerging probability of an ultra-hung Parliament could throw economic models haywire with one flick of its unpredictable political tail.”