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UK firms plan smaller price rises and wage hikes, BoE survey shows - Finance news and analysis from Global Banking & Finance Review
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UK firms plan smaller price rises and wage hikes, BoE survey shows

Published by Global Banking & Finance Review

Posted on July 24, 2026

1 min read

· Last updated: July 24, 2026

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UK Firms Anticipate Slower Price Rises and Wage Growth, BoE Survey Finds

Bank of England Survey Reveals Business Expectations

Overview of Survey Findings

LONDON, July 24 (Reuters) - British businesses expect to increase prices and wages by a bit less in the year ahead after a ceasefire in the Iran war briefly pushed down energy prices, according to a survey published by the Bank of England on Friday.

Price Growth Expectations

The monthly Decision Maker Panel showed companies in the three months to July expected price growth of 3.9% in ​the coming 12 months, down from a more than two-year high of 4.1​% in the three months to June although still above the rate of 3.4% expected in February before ⁠the war started.

Wage Growth Expectations

Expectations for year-ahead wage growth fell 0.1 percentage points to 3.4%.

Implications for Monetary Policy

Central Bank Response

The data is likely to be welcomed by the central bank which is closely watching price setting by firms and wage growth. It is expected to keep interest rates on hold next week.

Reporting and Editing

(Reporting by Suban AbdullaEditing by William Schomberg)

Key Takeaways

  • One‑year ahead own‑price growth expectations edged down to 3.9% in the three months to July, from June’s 4.1%, yet remain above February’s 3.4% pre‑war level (bankofengland.co.uk)
  • Year‑ahead wage growth expectations slipped to 3.4%, down 0.1 percentage point from June, signaling moderation in pay pressures (bankofengland.co.uk)
  • The easing in firms’ expectations follows a drop in energy prices after the U.S.–Iran ceasefire, which has reduced near‑term cost pressures and may reinforce the Bank of England’s decision to hold interest rates (bankofengland.co.uk)

References

Frequently Asked Questions

What did the Bank of England survey reveal about UK business expectations?
The BoE survey showed UK firms expect lower price and wage growth in the coming year.
How much do UK businesses expect prices to rise over the next 12 months?
Businesses expect prices to increase by 3.9% in the coming 12 months.
How have wage growth expectations changed among British companies?
Expected wage growth dropped by 0.1 percentage points to 3.4% year-ahead.
What recent event influenced UK firms' expectations for prices?
A ceasefire in the Iran war briefly pushed down energy prices and influenced expectations.
How might this data affect Bank of England's interest rate decision?
The data makes it likely the central bank will keep interest rates on hold next week.

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