BoE’s Decision Maker Panel survey for September indicating an anticipated ease in output price inflation, slowly easing CPI inflation expectation, and subtle nuances in wage growth predictions
A notable takeaway from the survey is the anticipated decline in output price inflation over the next year. Businesses foresee their year-ahead own-price inflation at 4.8%, a slight moderation from the 5.0% noted in the preceding three months to August. This decline hints at an expectation of easing price pressures, offering a counter-narrative to prevalent inflation concerns.
On the consumer front, one-year ahead CPI inflation expectations inched higher to 4.9% in September from 4.8% in August. However, a broader perspective reveals a decline, with the three-month moving average dipping by 0.3 percentage points to 5%. Looking further ahead, three-year CPI inflation expectations held steady at 3.2% in September, unaltered from August.
In the realm of wages, the anticipated year-ahead wage growth was static at 5.1% on a three-month moving average basis. September’s single-month reading did register a slight uptick to 5.2%, a 0.2 percentage point increment from August. However, these expectations are notably subdued compared to realised wage growth.
