What are the latest UK household inflation expectations for the next year and the longer term, according to the Bank of England’s Inflation Attitudes Survey?

According to the Bank of England’s quarterly Inflation Attitudes Survey, UK households expect inflation to reach 4% in the year ahead — up from 3.2% in February and the highest reading since November 2022 — while longer-term expectations rose to 3.9%, the highest since the BOE began collecting this data in 2009 and nearly double the BOE’s 2% target.

How are businesses responding to rising inflation and geopolitical uncertainty, particularly regarding staffing and wage settlements?

Businesses are responding to rising inflation and geopolitical uncertainty by shifting to short-term staff contracts, expecting staffing levels to remain broadly flat over the next 12 months; although average 2026 pay settlements remain unchanged at around 3.5%, early responses suggest the pace of wage disinflation will slow, and firms plan to pass on some recent cost increases despite concerns about weak demand and pressure on margins.

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