UK inflation expectations ebb before BoE meeting, Citi/YouGov survey shows (updated)
17/07/2024 16:09
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LONDON, July 17 (Reuters) - The British public's
expectations for inflation for the next 12 months and further
ahead have cooled markedly ahead of the Bank of England's
interest rate meeting next month, a survey showed on Wednesday.
Inflation expectations for the year ahead fell to 2.6% in
June, their lowest level since March 2020 and down from 3.1% in
May, the survey from banking group Citi and pollsters YouGov
showed.
Expectations for inflation five to 10 years ahead fell to 3%
from 3.2%, the lowest reading since May 2020.
"For the (BoE), this should provide further encouragement
that second round effects are continuing to fade in a relatively
symmetric fashion, consistent with fading wage pressures in the
forward-looking data," said Citi economist Benjamin Nabarro.
Investors see a roughly 33% chance of a BoE interest
rate cut on Aug. 1 after inflation data showed strong underlying
price pressures in Britain's economy, despite the headline rate
of price growth holding at 2%.
Earlier this week the chance of a rate cut was around 50%.
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GRAPHIC-UK public inflation expectations - Citi/YouGov https://tmsnrt.rs/3Sbicri
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(Reporting by William James, writing by Sachin Ravikumar and
Andy Bruce, Editing by Kylie MacLellan)
((saisachin.r@tr.com; Twitter: @sachinr27;))