LONDON (Reuters) – British households’ expectations for inflation over the next 12 months rose again in October, adding to the likelihood that the Bank of England will only cut interest rates once a quarter, a monthly survey from Citi and YouGov showed on Friday.
The survey showed expectations for inflation in a year’s time rose to 3.3% in October from 3.2%, up from a trough of 2.6% in June. For five to 10 years’ time, expectations rose to 3.8% in October from 3.6% and are 0.8 percentage points above June’s low.
“For the Monetary Policy Committee this is likely to provide continued reason for caution, implying quarterly rate cuts in the near-term,” Citi economist Benjamin Nabarro said.
(Reporting by David Milliken, Editing by Paul Sandle)
