The Bank of England (BoE) has released data showing that public expectations of inflation over the next 12 months are at their highest in five years, according to Reuters.
The proportion of the public anticipating that interest rates will rise has dropped, according to the research.
Brits surveyed in February 2019 said they expect inflation to average 3.2% over the next year, unchanged from November levels which were the highest proportion since November 2013.
The quarterly BoE survey of 4,000 people found 47% of UK citizens expect that interest rates will be raised over the next 12 months, down from 53% in November.
In February, consumer price inflation in Britain grew to 1.9% after a two-year low of 1.8% in January. The BoE forecast is that inflation will rise a little above the target 2% this year.
BoE has warned that a no-deal Brexit would impact these predictions, weakening sterling and making inflation rise sharply.
Inflation in the UK remained at a one-year low in May, leaving open the possibility of a raise in the interest rate from the Bank of England.
In May 2018 consumer price inflation was at 2.4%, the joint lowest annual rate since March 2017, according to the National Office for Statistics. A Reuters poll of economists had predicted a rate of 2.5%.
In November 2017 inflation reached a five-year high of 3.1%, as the drop in the value of the pound following the EU referendum led to a fall in consumer spending and slower growth in the British economy.
Rises in oil prices and energy bills are expected to produce further increases in the inflation rate in the coming months, followed by a tailing off towards the target rate of 2%.
Economists said there was nothing to indicate an urgent need to raise interest rates, following a November rise – the first since 2008.
Profits of the John Lewis Partnership have fallen more than 50% following a major programme of restructuring and redundancies, according to the BBC.
A £56.4m transformation programme meant that profits before tax fell 53.3% to £26.6m for the two quarters ending July 2017. Operating profits for the John Lewis department store rose 10% but Waitrose operating profits fell 18% due to higher costs.
John Lewis Partnership Chairman Sir Charlie Mayfield said that inflation and a weak pound had contributed to the drop: “This is a tough market for retailers. There’s any number of reasons for that. The reason our profits are down is predominantly because of margin, and cost prices are rising. It’s a very competitive market, retail prices are not rising as fast.”
Mayfield said that the retailer had chosen to absorb higher costs caused by inflation, using the Partnership’s cash reserves.
A statement from John Lewis also said spending on the reorganisation was an investment for the future and that the chain was moving forward.
Mayfield said: “While it’s been a difficult first-half, our sales have still been up, our profits are down, but we’ve made some really important progress for the future.”