Inflation expectations rise in Feb - Citi/YouGov

By @ibtimes on

Britons' inflation expectations for the next 12 months rose in February, a monthly survey from polling company YouGov showed on Tuesday.

The survey, carried out on behalf of Citi, showed inflation expectations climbed to 2.8 percent this month from 2.6 percent in January, although they remained well below the December level of 3.1 percent.

Longer-term inflation expectations also rose, with the estimates for annual inflation over the next five to 10 years ticking up to 3.4 percent from 3.2 percent in January.

Citi economist Michael Saunders said these results were unlikely to have much effect on the Bank of England policymakers' thinking.

Inflation expectations have receded from their peak, but are not in freefall - and there certainly is little sign of a deflation mentality, he wrote.

These results keep the window open for extra QE (quantitative easing) if the economy is sluggish... But, unless the economy's downside risks suddenly intensify a lot, no move either way on extra QE is likely until the May meeting.

(Reporting by David Milliken and Olesya Dmitracova)

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