–BOE/GfK NOP Survey: May Yr Ahead Inflation Expectations 3.7% V 3.5%
–Two-Year Ahead Expectations Rise To 3.4% From 2.9% In February
–May Longer-Term Inflation Expectations 3.6% Vs 3.4% In Feb
–Satisfaction With Job Done By BOE On Inflation Drops To 11% Vs 20%
–Survey May Fuel MPC Hawks’ Concerns On Inflation Outlook
LONDON (MNI) – Public inflation expectations for the year ahead
have risen to 3.7% – up from 3.5% seen in February, according to the
latest Bank of England/GfK NOP Inflation Attitudes survey.
Two-year and longer-term inflation expectations also rose. Two-year
inflation expectations climbed to 3.4% from the 2.9% seen in February.
The rise in inflation expectations will underline concerns among
some members of the Bank of England’s Monetary Policy Committee that the
persistently above-target level of inflation outturns may be dislodging
inflation expectations.
Yet how far these higher expectations can feed through into
stronger wage and price pressures, given the underlying weakness of the
economy remains to be seen.
The survey showed a rise in the percentage of the population
expecting interest rates to rise over the next 12 months, with 41% now
anticipating a rise compared with 35% in February.
Satisfaction among the public with the way the BOE is setting rates
to control inflation – fell to +11 in May from +20 in February, another
element in this report which may jangle alarm bells among the more
hawkish of the MPC.
Public perceptions of the current rate of inflation fell slightly
to a median of 4.7% from the 4.8% seen in February, the survey showed.
That compares with an annual CPI outturn of 3.0% in April.
Data for this survey was collected between May 17-22.
–London newsroom: 4420 7 862 7492; email: ukeditorial@marketnews.com
[TOPICS: M$B$$$,M$$BE$,MABPR$,MT$$$$]
