British consumers’ expectations for inflation rose last month and a measure of their satisfaction with the Bank of England dropped close to the lowest on record.
Consumers anticipated prices to increase 3.7 percent in the coming 12 months, up from 3.5 percent in February, the Bank of England said in a quarterly survey published in London today. Net satisfaction with the central bank fell to 11 percent from 20 percent in the prior report.
Inflation slowed to 3 percent in April, the first reading within the government’s limit since February 2010. The central bank’s forecasts last month showed the rate will stay above its 2 percent target for longer than officials predicted in February, though it will ease as growth struggles to pick up.
The bank’s Monetary Policy Committee held their bond- purchase plan at 325 billion pounds ($503 billion) yesterday, and kept their benchmark interest rate at a record low of 0.5 percent, as forecast in two Bloomberg News surveys. Officials will publish the minutes of the decision on June 20.
Expectations for longer-term inflation also increased. Consumers predicted prices to rise an annual 3.6 percent in five years, the highest since the question was first posed in 2009.
Net satisfaction with the way the bank is “doing its job to set interest rates to control inflation” is measured by taking the balance of those satisfied minus those dissatisfied. The reading was close to the 9 percent reached in November, the lowest since the survey began 1999.
The poll of 1,966 people aged 16 or over was conducted by GfK NOP Ltd. from May 17 to May 22.
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