January 8, 2013 / 11:50 AM / 5 years ago

UK inflation expectations fall further in December - YouGov

LONDON (Reuters) - Britons’ inflation expectations for the next 12 months dipped to 2.7 percent in December from 2.8 percent in November, a survey by polling company YouGov for bank Citi showed on Tuesday.

Inflation expectations for the next five to 10 years also dropped, coming in at 3.3 percent compared to 3.4 percent in November.

“Inflation expectations have actually fallen over the last year and last two years, despite continued above-target inflation and further unconventional policy stimulus,” said Citi economist Michael Saunders.

“These readings for inflation expectations are unlikely to stop the MPC (Bank of England’s Monetary Policy Committee) expanding QE (quantitative easing) further if, as we expect, the economy continues to undershoot their expectations,” he added.

Reporting by Olesya Dmitracova

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