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UK Firms Lower Price Hike Expectations to 3.7% Amidst Energy Cost Pressures: BoE Survey
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News18•02-10-2026, 16:30
UK Firms Lower Price Hike Expectations to 3.7% Amidst Energy Cost Pressures: BoE Survey
- •UK businesses anticipate a 3.7% increase in prices over the next year, a slight reduction from previous estimates, according to the Bank of England's latest Decision Maker Panel (DMP) survey.
- •The year-ahead own-price inflation, measuring expected selling price increases, stood at 3.7% in the three months to September, a 0.1 percentage point decrease from the prior period.
- •Firms reported actual annual price growth also at 3.7% in the three months to September, remaining unchanged from the previous period.
- •Broader inflation expectations remained stable, with businesses expecting consumer price inflation (CPI) at 3.1% one year ahead and 2.8% three years ahead.
- •Despite lower price expectations, 70% of firms anticipate the energy shock will reduce profit margins, indicating they plan to absorb some costs rather than fully passing them to consumers.
Key Questions Answered
According to the Bank of England's latest Decision Maker Panel survey, UK businesses expect the prices they charge to rise by 3.7 per cent over the next year, which is slightly lower than their previous estimate.
Higher energy costs continue to put pressure on businesses, with 57 per cent of firms in September expecting to increase prices due to these costs and 70 per cent indicating that the energy shock will reduce their profit margins.
Businesses expect consumer price inflation to remain stable at 3.1 per cent one year ahead and 2.8 per cent three years ahead, while annual wage growth expectations over the next year remain steady at 3.4 per cent.
