Finance
UK short-term inflation expectations rise, Citi and YouGov say
Published by Global Banking & Finance Review®
Posted on July 25, 2025
2 min readLast updated: January 22, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on July 25, 2025
2 min readLast updated: January 22, 2026
UK inflation expectations rose to 4% for the next year, according to a Citi and YouGov survey, impacting Bank of England's rate decisions.
LONDON (Reuters) -The British public's inflation expectations for the next 12 months rose in July and remained high over the longer term despite a slight dip from June, according to a survey published on Friday by bank Citi and opinion poll firm YouGov.
Expectations for inflation over the coming year edged up to 4% from June's reading of 3.9%, the survey showed.
Expectations for 5-10 years ahead fell to 4.2%, down from June's 4.3% but only back to a level they touched in May.
Citi economist Callum McLaren-Stewart said the stubbornly high longer-term expectations were likely to add to concerns among some Bank of England interest rate-setters.
"We infer little in the way of dovish signal from this month’s Citi/YouGov survey and think this data series will continue to lean hawkish in the view of the MPC," McLaren-Stewart said.
The BoE is widely expected to cut rates on August 7 as some Monetary Policy Committee members worry about a slowdown in the labour market. However, many analysts expect the BoE to continue with its gradual pace of cuts to borrowing costs due to inflation pressures lingering in Britain's economy.
Official data published earlier this month showed British consumer price inflation rose to 3.6% in the 12 months to June from 3.4% in May - well above the BoE's 2% target.
(Reporting by Muvija M; Writing by William Schomberg)
Expectations for inflation over the coming year edged up to 4% from June's reading of 3.9%.
Expectations for 5-10 years ahead fell to 4.2%, down from June's 4.3%, indicating a slight decrease.
The stubbornly high longer-term inflation expectations are likely to add to concerns among some Bank of England interest rate-setters.
The Bank of England is widely expected to cut rates on August 7 due to concerns about a slowdown in the labour market.
Official data showed British consumer price inflation rose to 3.6% in the 12 months to June, up from 3.4% in May.
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