UK long-term inflation expectations rise to 4.3% in September
Citi/YouGov data show the public's long-term inflation view up from 4.1% in August, a reading that lines up with the Bank of England's recent caution.
Published
UK long-term public inflation expectations rose to 4.3% in September, up from 4.1% in August, according to Citi/YouGov data.
The move follows a run of commentary from Bank of England officials warning that price pressures may prove harder to shift than recent data suggest. Six of the nine members of the Monetary Policy Committee backed holding Bank Rate at 3.75% this month. Dave Ramsden has said inflation risks are now more likely to rise than fall, pointing to local food costs and wage agreements, and has called the Bank's quantitative tightening plan a credible and logical strategy. Governor Andrew Bailey has said pass-through from high energy prices has been subdued so far, but that it is too early to judge whether that will last.
Markets are pricing only 38 basis points of rate cuts by the end of the year, a stance that has helped support sterling in recent weeks. The uptick in long-term expectations, while modest, reinforces the Bank's hawkish shift and backs up policymakers' concern that price pressures remain sticky even with recent benign data on food and energy pass-through. That keeps rate cut expectations subdued for 2026 and 2027, a backdrop that continues to underpin the currency.