NEARLY half of people now expect benchmark UK interest rates to rise over the next 12 months, a survey from the Bank of England has shown.
In the latest quarterly survey of the public's inflation attitudes, conducted for the Old Lady of Threadneedle Street by pollster GfK NOP and published yesterday, 49 per cent of respondents expected UK base rates to rise over the next 12 months.
This was significantly higher than in the previous quarterly survey in May, when 42 per cent of people forecast a rise in benchmark interest rates over a 12-month timeframe.
UK base rates have been at a record low of 0.5 per cent since March 2009.
In the latest survey, 29 per cent of people said rates might stay about the same over the next 12 months. This was down sharply from the 36 per cent of respondents expressing such a view in the May survey.
Respondents' median expectation of the rate of annual UK consumer prices index inflation over the coming year was 2.8 per cent, up slightly from 2.6 per cent in the May survey. Official figures published last month showed annual CPI inflation fell from 1.9 per cent in June to 1.6 per cent in July.
Many economists forecast the first rise in base rates will come by the early part of next year.
Recent economic indicators are perceived to have reduced the chances of an increase in benchmark borrowing costs by the end of 2014.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article