UK public inflation expectations surge to 4% after Iran conflict, Bank of England survey shows

British households just told the Bank of England what it didn’t want to hear. Median expectations for inflation over the next 12 months jumped to 4% in the latest survey, up from 3.2% in February, a sharp move that traces directly back to the energy shock triggered by the escalation of the US-Israeli conflict with Iran.

The BOE’s Inflation Attitudes Survey, published on June 12, paints a picture of a public growing increasingly skeptical that price stability is anywhere on the horizon.

The numbers tell a consistent story

The BOE’s survey isn’t an outlier. A separate Citi/YouGov survey showed one-year-ahead inflation expectations spiking to 5.4% in March, the highest reading since 2023. That figure cooled to 4.7% by May.

Actual UK inflation hit 3.3% in March, reversing the progress the BOE had been making toward its 2% target.