U.K. Consumers Are Worried About Brexit Pushing Up Prices
Half of Britons say that the U.K.’s departure from the European Union has pushed up their expectations for price growth, a Bank of England survey showed Friday.
Inflation expectations for the coming year stood at 3.3% in August, the BOE said, the highest since 2013 and up from 3.1% in May. Consumers are slightly more optimistic about the longer term, with respondents saying they expect inflation of 3.1% in five-years’ time, down from 3.8% in May.
A further fall in the pound as well as new trade barriers could push price growth above the BOE’s 2% target once the U.K. quits the EU. Still, 10% of respondents to the survey said Brexit has lowered their expectations for price growth.
Among them could be Wetherspoon pub CEO Tim Martin, who says he would cut prices to an “unbelievable low” after Brexit. He announced Friday that he will cut 20 pence off the price of pints of Ruddles bitter, which is produced by British brewer Greene King.
©2019 Bloomberg L.P.