UK inflation expectations for the coming year rose to their highest level in five years, survey data from the Bank of England showed on Friday.
Median expectations of the rate of inflation over the coming year were 3.2 percent, compared to 3.0 percent in August, the results of the quarterly Bank of England/TNS Inflation Attitudes Survey showed.
The 3.2 percent expectation was the highest since the November survey of 2013, when the year-ahead inflation was projected at 3.6 percent.
The survey was conducted between November 2 and 6 among 2197 people.
The Bank of England target's inflation at 2 percent. In October, inflation was 2.4 percent. Price growth hit a peak of 3.1 percent in November 2017.
Survey respondents said the current rate of inflation was 3.1 percent versus 2.9 percent in the August survey. They expect inflation to be 2.8 percent in two years' time and 3.5 percent in five years.
Regarding the future path of interest rates, 53 percent of survey respondents expected rates to rise over the next 12 months, which was less than the 58 percent in August.
Britain is preparing to leave the European Union on March 29, 2019. The Bank of England has warned that a no-deal Brexit would cause a severe recession in the UK, the kind not even seen during the global financial crisis a decade ago.
The central bank's analysis projected that inflation could hit 6.5 percent as the pound dives in a no-deal or disorderly Brexit.
BoE Governor Mark Carney also predicted that food prices could jump as much as 10 percent if there is a 25 percent slump in the pound due to a no-deal Brexit.
Elsewhere on Friday, survey results from IHS Markit showed that permanent placements and temporary billings grew softly in November. However, temporary pay grew at the fastest pace since July 2007.
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