"But for now, the direct risks to expectations appear
contained. And, with inflation having now peaked, we think there
are tentative signs some of the acute risks that pervaded
earlier in 2022 are now beginning to ease," Nabarro said.
(Reporting by Andy Bruce; Editing by Kate Holton)
(Adds quote from Citi)
LONDON, Jan 31 (Reuters) - The British public's
predictions for inflation cooled again in January, according to
a survey on Tuesday that should further comfort the Bank of
England that high prices will not become permanently embedded in
expectations.
U.S. bank Citi and polling firm YouGov said inflation
expectations for five to 10 years ahead fell to 3.5% from 3.6%
in December - within touching distance of the 3.0% to 3.4% range
seen ahead of the COVID-19 pandemic.
For inflation in a year's time, expectations in January fell
to 5.4% from 5.7% in December.
The BoE is expected to raise interest rates on Thursday to
4% from 3.5%, according to a Reuters poll of economists.
Citi economist Benjamin Nabarro said business surveys,
financial market inflation expectations and strong wage growth
would keep upside risks to price pressures very much in the
minds of BoE policymakers.
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