The Bank of England has released the results of its latest quarterly survey of public attitudes to inflation, undertaken between 6 and 11 August 2015.
Highlights from the survey
Question 1: Asked to give the current rate of inflation, respondents gave a median answer of 2.1%,
compared to 2.2% in May.
Question 2a: Median expectations of the rate of inflation over the coming year were 2.0%, compared with 2.2% in May.
Question 2b: Asked about expected inflation in the twelve months after that, respondents gave a median answer of 2.3%, unchanged since May.
Question 2c: Asked about expectations of inflation in the longer term, say in five years’ time, respondents gave a median answer of 2.8%, unchanged since May.
Question 3: By a margin of 45% to 10%, survey respondents believed that the economy would end up weaker rather than stronger if prices started to rise faster, compared with 49% to 11% in May.
Question 4: 54% of respondents thought the inflation target was ‘about right’, down from 57% in May, while the proportions saying the target was ‘too high’ or ‘too low’ were 20% and 7% respectively.
Question 5: 10% of respondents thought that interest rates had fallen over the past 12 months, compared with 18% in May, while 20% of respondents said that interest rates had risen over the past 12 months, compared with 17% in May.
Question 6: When asked about the future path of interest rates, 26% said rates might stay about the same over the next twelve months, down from 42% in May. 50% of respondents expected rates to rise over the next 12 months, up from 38% in May.
Question 7: Asked what would be ‘best for the economy’ – higher interest rates, lower rates or no change – 22% thought rates should ‘go up’, up from 17% in May. 13% of respondents thought that interest rates should ‘go down’, compared with 14% in May. 35% thought interest rates should ‘stay where they are’, compared to 43% in May.
Question 8: When asked what would be ‘best for you personally’, 23% of respondents said interest rates should ‘go up’, unchanged since May. 20% of respondents said it would be better for them if interest rates were to ‘go down’, down from 23% in May.
Question 14: Respondents were asked to assess the way the Bank of England is ‘doing its job to set interest rates to control inflation’. The net satisfaction balance – the proportion satisfied minus the proportion dissatisfied – was +33%, down from +35% in May.