UK public's inflation expectations fall again in March - Citi/Yougov survey shows

The British public's expectations for inflation over the next year and the longer term fell in March, U.S. bank Citi said on Thursday as it published a monthly survey by market research firm YouGov.

Citi said public expectations for inflation in 12 months' time fell to 3.3% in March from 3.6% in February, while expectations for the five- to 10-year period fell to 3.4% from 3.5%.

"At the start of 2024, reporting around shipping disruption, as well as risks to energy supplies, once again likely drove these data higher," Citi economist Benjamin Nabarro said in a note to clients about the Yougov survey.

"It is encouraging to see these numbers falling relatively quickly."

Data from Citi/Yougov for February also showed a fall in the public's inflation expectations.

The falling trend in the public's inflation expectations should provide further encouragement to the BoE's monetary policy committee that second-round effects of inflation are fading, Nabarro added.

Data last week showed British inflation slowed to 3.4%, the lowest since September 2021, raising expectations that the Bank of England could start cutting interest rates in the months ahead.