British businesses expect to reduce staff numbers but raise prices at a similar rate to before, according to a survey of more than 2,000 firms on Thursday by the Bank of England that was conducted before finance minister Rachel Reeves’ annual budget.
The Decision Maker Panel conducted between November 7 and November 21, showed firms planned to raise prices by 3.7 per cent percentage points over the next 12 months, 0.1 percentage points more than they had expected one month earlier.
Expectations for employment over the next year weakened, falling by 0.1 percentage points to -0.2 per cent in the three months to November.
Companies’ expectations for consumer price inflation in the year ahead were unchanged in the same period at 3.4 per cent in November.
British consumer price inflation fell to 3.6 per cent in October and the BoE expects it to have peaked, strengthening its case to cut interest rates from their current 4 per cent.
The BoE survey showed businesses expected wage growth of 3.8 per cent over the coming year in the three months to November, 0.1 percentage points higher than in the three months to October.
