UK rate hike expectations over the next year plunge to record low - BoE survey

Bank of England's survey showed earlier on Friday that the proportion of British people who think the Bank of England will raise interest rates over the next year has plunged to record low. The report showed 21 percent of people surveyed in August expected the central bank to raise rates in the next 12 months, down from 41 percent in May, the lowest level since the survey began in 1999.

Nineteen percent of respondents thought the BoE would cut rates in the coming year, up from just 5 percent in May and the highest level since November 2008.

According to the Bank of England's quarterly Inflation Attitudes Survey, median expectation for inflation among the British public rose from 2.0 percent to 2.2 percent. However inflation expectations in the twelve months after that remained unchanged from May at 2.2 percent.

Over longer time-frames (in five years' time) respondents pegged the rate of inflation at 3.0 percent, down from 3.4 percent in the last survey. A slightly smaller proportion of respondents, 20 percent, believed interest rate increases would be better for the economy, versus the 21 percent who said they believed that in the last poll.