People are far closer to knowing the inflation rate now: estimating 3.7% for November (CPI was 4.2% in October).
By comparison, when it was 0.4% in February this year they estimated 2.5%.
When asked what will happen to rates, 21% said they expect them to stay about the same for the next 12 months, while 60% expect them to rise.
The proportion expecting rates to rise over the next 12 months has risen from 43% in August to 60% in November
When asked what would be best for the economy, 35% of people said rates should stay where they are, and 25% thought they should go up.
The Bank of England/Kantar inflation expectation figures were released today: Bank of England/Kantar Inflation Attitudes Survey – November 2021 | Bank of England
Sarah Coles, senior personal finance analyst, Hargreaves Lansdown: “Inflation has become a pressing issue for millions of people, who are seeing prices go through the roof. Usually only those with a real interest in money have any idea what’s happening with inflation, but right now, millions of us know all too well how much pressure our budgets are under.
“When inflation isn’t a major concern, most people have to hazard a rough guess at what inflation might look like. It’s why in February, when CPI was at 0.4%, on average people estimated inflation was at 2.5%.
“But right now, with the price of everything from fuel to energy and food rising sharply, we’re well aware of just how much more things are costing us.
“We’re also much more keenly aware of the chance that a rate rise is on the cards in the not-too-distant future. 60% of people expect rates to rise over the next 12 months – a number that has been climbing steadily for the past year, but saw a jump from 43% over the past 3 months.
“When asked what rate rises would mean for us, 29% of people said it would be better for them personally if rates rose, while 20% said it would be better if they fell and 26% said it would be better if they remained where they are.
“Some of this may be because people feel a rate rise could control prices. However, when the same survey asked people about the relationship between rate rises and inflation back in February, only just under a third were aware that higher rates could push prices down.
“There’s a real risk that people don’t realise the impact that a rate rise could have on the cost of their borrowing, and while those on fixed-rate mortgages or loans may be protected for the length of the fix, those on variable-rate deals and anyone with a credit card could be in for a nasty surprise when rates start going up.”