21st March 2023

Bank of England/Ipsos Inflation Attitudes Survey-February 2023

The Bank of England comments:

"This quarterly survey, conducted by Ipsos on our behalf, assesses public attitudes to inflation, opinions about the Bank and awareness of our work.

From February 2022, the survey has been conducted on the Bank of England's behalf by Ipsos, prior to that it was conducted by Kantar. Ipsos interviewed two quota samples of people aged 16-75 across the UK; the first sample was surveyed between 3rd and 6th February 2022 and the second between 17th and 19th February 2023.

Please note, the Government’s social distancing guidance meant that face-to-face interviewing was not possible for the surveys conducted since May 2020. These have been conducted online instead. This change resulted in a methodological break in the series in May 2020. For example, the proportions of respondents who answered “Don’t know/ No idea” to the May survey’s questions declined substantially. That perhaps reflected the design of the online questionnaire, where the option of “Don’t know/ No idea” appeared only if the respondent tried to move onto the next question without giving an answer. In the surveys since August 2020 however, the option of “Don’t know/ No idea” appeared in the same showcard as the other options. The proportions of respondents answering “Don’t know/ No idea” returned to usual levels for most questions in the August 2020 and subsequent surveys.

These mode of collection changes mean caution should be taken when making comparisons across the latest eleven surveys and May 2020 and with previous vintages, which were based on face-to-face interviews.

Highlights from the Survey:

Question 1: Asked to give the current rate of inflation, respondents gave a median answer of 9.2%, unchanged from November 2022.

Question 2a: Median expectations of the rate of inflation over the coming year were 3.9%, down from 4.8% in November 2022.

Question 2b: Asked about expected inflation in the twelve months after that, respondents gave a median answer of 3.0%, down from 3.4% in November 2022.

-Question 2c: Asked about expectations of inflation in the longer term, say in five years’ time, respondents gave a median answer of 3.0%, down from 3.3% in November 2022.
-Question 3: By a margin of 70% to 6%, survey respondents believed that the economy would end up weaker, rather than stronger, if prices started to rise faster, the same as November 2022.
-Question 4: 38% of respondents thought the inflation target was ‘about right’, up from 35% in November 2022. The proportions saying the target was ‘too high’ or ‘too low’ were 29% and 14% respectively.
-Question 5: 75% of respondents said that interest rates on things such as mortgages, bank loans and savings had risen over the past 12 months, compared with 78% in November 2022. Meanwhile, 4% of respondents thought that interest rates had fallen over the past 12 months, in line with November 2022.
-Question 6: When asked about the future path of interest rates, 58% of respondents expected rates to rise over the next 12 months, down from 74% in November 2022. 21% said they expected rates to stay about the same over the next twelve months, up from 11% in November 2022.
-Question 7: Asked what would be ‘best for the economy’– higher interest rates, lower rates or no change– 6% thought rates should ‘go up’, compared to 20% in November 2022. 33% of respondents thought that interest rates should ‘go down’, compared to 30% in November 2022. 27% thought interest rates should ‘stay where they are’, up from 25% in November 2022.
-Question 8: When asked what would be ‘best for you personally’, 27% of respondents said it would be better for them if interest rates were to ‘go up’, in line with 27% in November 2022. 30% of respondents said it would be better for them if interest rates were to ‘go down’, in line with 30% in November 2022.
-Question 14: Respondents were asked to assess the way the Bank of England is ‘doing its job to set interest rates to control inflation’. The net satisfaction balance, the proportion satisfied minus the proportion dissatisfied, was -4%, up from -12% in November 2022.

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