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UK firms see CPI expectations ease to 3.4% in July DMP survey
UK firms' year-ahead CPI expectations fell to 3.4% in July, the Bank of England's DMP survey showed. Wage growth cooled to 4.0%, while employment remained weak but improved slightly.
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British businesses trimmed their inflation expectations again in July, with the Bank of England's Decision Maker Panel survey showing a drop in year-ahead CPI forecasts to 3.4%, down from 3.7% in the three months to June. Three-year-ahead CPI expectations edged down to 2.8% from 2.9%.
The July survey, conducted between the 3rd and 17th and drawing 1,982 responses, also showed firms' own-price growth expectations softening. Year-ahead own-price inflation fell 0.2 percentage points to 3.9%. Realised own-price growth held steady at 3.8%.
Wage growth is cooling, too. Firms reported annual wage growth of 4.0% in the three months to July, down 0.1 percentage points from the prior period. Expected year-ahead wage growth slipped to 3.4%, implying firms expect wage growth to drop 0.6 points over the next year.