Bank of England/Kantar Inflation Attitudes Survey - August 2020

This news release describes the results of the Bank of England’s latest quarterly survey of public attitudes to inflation, undertaken between 11 and 16 August 2020.

Please note, the Government’s social distancing guidance meant that face-to-face interviewing was not possible for either the latest survey or May 2020 survey. 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 August 2020 survey however, the option of “Don’t know/ No idea” appeared in the same showcard as the other options. This resulted in proportions of respondents answering “Don’t know/ No idea” returning to usual levels  for most of the August survey’s questions. 

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

More details about the methodology applied in the August and May 2020 survey can be found in the ‘Methodology and notes – Online survey’ attachment and that of previous surveys in the ‘Methodology and notes – Face-to-face survey’ attachment.

Highlights from the Survey

Question 1: Asked to give the current rate of inflation, respondents gave a median answer of 2.6%, compared to 2.4% in May.

Question 2a: Median expectations of the rate of inflation over the coming year were 2.8%, down from 2.9% in May. 

Question 2b: Asked about expected inflation in the twelve months after that, respondents gave a median answer of 2.2%, up from 1.9% in May. 

Question 2c: Asked about expectations of inflation in the longer term, say in five years’ time, respondents gave a median answer of 2.8%, compared to 2.6% in May. 

Question 3: By a margin of 54% to 9%, survey respondents believed that the economy would end up weaker rather than stronger if prices started to rise faster, compared with 54% to 12% in May and 47% to 10% in February. 

Question 4: 42% of respondents thought the inflation target was ‘about right’, down from 55% in May. The proportions saying the target was ‘too high’ or ‘too low’ were 28% and 10%, respectively. 

Question 5: 40% of respondents thought that interest rates on things such as mortgages, bank loans and savings had fallen over the past 12 months, compared with 50% in May and 12% in Feb, while 18% of respondents said that interest rates had risen over the past 12 months, down from 25% and 27% in May and February, respectively. 

Question 6: When asked about the future path of interest rates, 33% said they expected rates to stay about the same over the next twelve months, compared with 39% in May. 31% of respondents expected rates to rise over the next 12 months, down from 42% in May and 39% in February. 

Question 7: Asked what would be ‘best for the economy’ – higher interest rates, lower rates or no change – 19% thought rates should ‘go up’, down from 25% in May, but higher than February’s score of 17%. 16% of respondents thought that interest rates should ‘go down’, down from 18% in May. 37% thought interest rates should ‘stay where they are’, down from 45% in May.

Question 8: When asked what would be ‘best for you personally’, 28% of respondents said it would be better for them if interest rates were to ‘go up’, down from 30% in May, but up from 20% in February. 19% of respondents said it would be better for them if interest rates were to ‘go down’, down from 21% in May. 

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 +19%, down from +23% in May.

Summary results

Detailed survey results