BoE Sees Drop in Inflation Expectations After Survey Provider Change

The Bank of England reported a significant drop in public inflation expectations for the next five years after changing its survey provider from Ipsos to Savanta. The change is likely to have contributed to the decline, with some experts arguing that it has flattered the numbers.

Savanta's August survey found year-ahead inflation expectations of 3.2%, down from 4.0% reported by Ipsos in May, and five-year expectations dropped to 3.2% from 3.9%. However, when adjusted for the break in the data series, expectations had eased only slightly.

Pantheon Macroeconomics criticized the Bank of England for not publishing a consistent data series, saying that it would have been better to publish a break-adjusted time series to allow for easier comparison.