Live Updates > Live Update Details
2025-09-12 17:59:41
[Inflation expectations soar! The Bank of England faces a severe test] ⑴ The British public's expectations for inflation over the next five years have risen to 3.8%, the highest level since May 2019, which may make some Bank of England policymakers uneasy ahead of next week's interest rate decision. ⑵ Although this is not a precise forecast, the rise in public inflation expectations may become a risk factor for future inflation increases, increasing the likelihood that people will demand higher wages and accept higher prices. ⑶ The survey showed that the public's net satisfaction with the Bank of England's approach to controlling inflation fell from +6 in May to +2 in August, although it is still higher than it has been for most of the past three years. ⑷ The UK's consumer price index rose to an 18-month high of 3.8% in July, the highest level among the Group of Seven (G7) countries, and the Bank of England expects inflation to reach 4% in September and return to its target level in the second quarter of 2027. ⑸ The Bank of England cut interest rates by 25 basis points to 4% in August, but the market generally believes that the possibility of a rate cut next week is minimal, and the probability of a rate cut later this year is only about 40%.
