British Inflation Expectations Rise Amid Energy Price Spikes

A recent survey by Citi and YouGov found that public inflation expectations in Britain rose to their highest level since April, reversing a trend of falling inflation rates over the past few months.

The survey reported that expectations for inflation over the next 12 months jumped to 3.9% from 3.4% in July, while expectations for price growth in the longer term increased to 4.1%, their highest level since April, from 3.7%.

Citi noted that this jump in inflation expectations is a 'hawkish development' and that the Bank of England is watching closely for signs that the recent spike in energy prices could lead to longer-lasting inflation pressures.