UK inflation expectations for 2017 have hit three-year high, according to new poll

In November, the Bank of England predicted that inflation would surpass 2.7 per cent by the end of 2017

Inflation jumped to a two-year high of 1.6 per cent in December (Getty)

UK inflation expectations for the coming year have hit a three-year high, according to a new poll.

The survey, conducted by YouGov and Citigroup and released on Wednesday, shows that short-term inflation expectations (for the coming 12 months) rose to 2.6 per cent in January, the highest level since December 2013 and a small increase from 2.4 per cent in December.

Longer-term inflation expectations (for five to 10 years ahead) were unchanged from December at an average of three per cent per year.

The findings chime with the Bank of England’s most recent forecasts.

In November, the Bank predicted that inflation would surpass 2.7 per cent by the end of 2017, spurred by a fall in the value of sterling since the UK’s June vote to quit the European Union.

Inflation expectations on the rise

Citi

Inflation already jumped to a two-year high of 1.6 per cent in December.

The Bank is due to publish fresh inflation forecasts on Thursday.

Earlier this week, a CBI survey showed that growth in Britain’s private sector and confidence among consumers was solid in the three months to January, but that rising inflation was imminent.

The business lobby group said that inflation threatens to erode consumer incomes over the coming months and that investment spending could slow this year as a result of the uncertainty surrounding Brexit.

The YouGov and Citigroup survey, which was conducted during a three-day period at the end of January, is a monthly poll and was based on a sample of just over 2,000 adults.