-UK July Year Ahead Inflation Expectations 2.4%: Unchanged From June
LONDON (MNI) – UK year ahead inflation expectations held steady in
July having fallen sharply in June, showing that the previous fears of
some Bank of England Monetary Policy Committee members that a long run
of elevated inflation outturns could destabilise expectations have not
materialised.
Year ahead inflation expectations stood at 2.4% in July, unchanged
from June, with longer term inflation expectations nudging up to 3.3% on
the year from 3.2% in June, according to the Citi/YouGov survey.
Michael Saunders, economist at Citi, said “inflation expectations
now are reasonably well contained.”
Year ahead inflation expectations were bang-in-line with the latest
CPI outturn for June and there is growing evidence inflation is on the
downpath, which could push expectations lower still.
In the second quarter average CPI fell to just 2.7% on the year,
significantly below the Bank of England’s May Inflation Report forecast
of 3.19%.
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