UK Firms Anticipate Slower Price Rises and Wage Growth

A recent survey by the Bank of England found that UK firms expect smaller price and wage rises in the year ahead. The monthly Decision Maker Panel showed that companies anticipate a price growth of 3.9% in the coming 12 months, down from a more than two-year high of 4.1% in June.

This decrease is attributed to the brief drop in energy prices following the US-Iran ceasefire. As a result, firms' expectations for wage growth also eased, with year-ahead wage growth expectations slipping to 3.4%, down 0.1 percentage point from June.

The data is likely to be welcomed by the central bank, which is closely watching price setting by firms and wage growth. It is expected to keep interest rates on hold next week.