The CPI rate published this week showed that UK inflation held steady at 3% for October and came in lower than the predicted 3.1%.
However, the rate still remains the highest in the UK since 2013.
As a result, some investors argued that it may be the time to go defensive and invest more cautiously, yet Hollands, managing director at Tilney, remains more optimistic.
“The global economy is in pretty decent shape, but the UK is slightly different as it has got some headwinds at the moment,” he said.
“But Tuesday shows you that inflation has peaked, and our view is that inflation should start coming down in 2018.”
Hollands said slowing wage growth coupled with inflation was putting a strain on spending.
“In the aftermath of the Brexit vote, the one thing that really kept the economy going was that consumers kept spending,” he said. “The economy has been a lot more resilient through all the doom and gloom predictions, which is a good thing.
“However, for the time being, inflation is higher than wage growth and that’s a pinch on people’s pockets.
“The environment is becoming tougher for the consumer than it was, but this is likely to be temporary.”
