Bank of England survey shows businesses expect higher price growth and wage increases in the year ahead.
UK businesses raised their year-ahead own-price inflation expectations to 4.1% in June, up 0.1 percentage point from May, according to the Bank of England’s Decision Maker Panel. The increase marks a continued upward trend in corporate inflation forecasts amid persistent price pressures.
The survey also revealed a slight rise in expected wage growth, climbing to 3.5% from 3.4% in May. Both metrics remain above the BoE’s 2% inflation target, signaling potential challenges for monetary policy as the central bank weighs further interest rate adjustments.
Higher inflation expectations could reinforce the BoE’s cautious stance on rate cuts, with markets closely monitoring wage and price trends for signs of sustained inflationary pressures.