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UK inflation expectations hit six-year low in January - Citi/YouGov

Published 29/01/2015, 17:44
© Reuters. A woman passes racks of greetings cards displayed in a shop in London

LONDON (Reuters) - The British public's expectations for inflation in the next 12 months fell to their lowest level in six years in January, while longer-term inflation expectations hit a record low, according to a survey on Tuesday.

The monthly Citi/YouGov survey found year-ahead inflation expectations fell to 1.2 percent in January from 1.5 percent in December, the lowest level since January 2009.

Expectations for inflation over the next five to 10 years fell to 2.6 percent from 2.7 percent in December, marking a new record low.

"On the whole, we regard the drop in inflation expectations as positive for growth, because it will translate into higher real income expectations," said Michael Saunders, economist at survey sponsor Citi.

© Reuters. A woman passes racks of greetings cards displayed in a shop in London

Official data showed British consumer price inflation plunged to its lowest level since May 2000 last month and Bank of England Governor Mark Carney has said it could turn negative in the next few months.

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