-UK November Year Ahead Inflation Expectations 2.8% Vs 3.0% Oct
LONDON (MNI) – UK year ahead inflation expectations dipped in
November, despite a rise in the latest headline inflation data.
The Citi/YouGov survey showed year-ahead inflation expectations
dropped to 2.8% in November from 3.0% in October, while longer-term
inflation expectations fell to 3.4% from 3.7%, hitting their lowest
level since July.
The October inflation data showed CPI rose to 2.7% from September’s
2,2%.
“The long period of above-target inflation and unconventional MPC
policies has not destabilised inflation expectations further,” Citi
economist Michael Saunders said in a note.
The survey was conducted between November 21 and 23, after the Nov
13 publication of the official inflation data.
The 2.8% outturn in the Citi/YouGov survey was pretty much in line
with the January to October average of 2.7% and down from the 2011
average of 3.4%.
Some Bank of England Monetary Policy Committee members have
persistently expressed concerns that the prolonged run of above target
inflation could destabilise expectations, but the survey evidence once
again shows this risk not materializing.
In a Nov 21 speech, MPC member Martin Weale again raised the alarm
saying – “While inflation remains above target, there is an obvious risk
that, at some point, people involved in setting of wages and prices will
start to think that we do not take the inflation target seriously.”
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