The July DMP survey was conducted between 5 and 19 July and received 2,163 responses.
Firms reported that their output prices rose by an average annual rate of 4.2% in the three months to July, down 0.4 percentage points from 4.6% in the three months to June. Note that the DMP covers own prices from firms across the whole economy, not just consumer-facing firms.
Year-ahead own-price inflation was expected to decline to at 3.7% in the three months to July, 0.2 percentage points lower than firms reported in the three months to June. Businesses therefore expect output price inflation to decline by 0.5 percentage points over the next 12 months based on three-month averages.
One-year ahead expected CPI inflation fell by 0.3 percentage points to 2.5% in July. The three-month average fell by 0.2 percentage points to 2.7% in July. Three-year ahead CPI inflation expectations also fell to 2.5% in the monthly data in July, 0.2 percentage points lower than in June. The three-month average was 0.1 percentage points lower at 2.6% in the three months to July.
Expected year-ahead wage growth fell by 0.1 percentage point to 4.1% on a three-month moving-average basis in July. Annual wage growth was 5.9% in the three months to July, also 0.1 percentage points lower than in the three months to June. Firms therefore expect their wage growth to decline by 1.8 percentage points over the next 12 months based on three-month averages.
Firms reported annual employment growth of 0.9% in the three months to July, lower than the 1.1% reported in the three months to June. Expected year-ahead employment growth fell by 0.1 percentage points to 1.1% in the three months to July.
Firms reported that the average interest rate that they were paying on their borrowing (both bank and market based) was 6.8% in the three months to July, unchanged from the three months to June. Over the next year, firms expect the average interest rate on their borrowing to fall to 5.9% based on data from the three months to July, also unchanged from June.
Uncertainty rose marginally in July with 53% of firms reporting that the overall level of uncertainty facing their businesses was high or very high, 3 percentage points higher than in June. However, sales and price uncertainty continued to decline.
Published on
01 August 2024
The DMP was set up in August 2016 and is run by the Bank of England in collaboration with King’s College London and the University of Nottingham. It was designed to be representative of the population of UK businesses. All results are weighted. See Bloom et al (2017) for more details.
The DMP receives funding from the Economic and Social Research Council.