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According to a public poll Citi and YouGov, expectations of inflation in the year to come currently stand at 3pc, compared to 2 9pc in September.

"Expectations of inflation for the year to come step are higher since September 2008," Citi economist Michael Saunders said .the ' inflation was then running at 5 2pc - a maximum of 16 years, compared with currently 3 1pc.

Policymakers are concerned that rising inflation expectations could become self-fulfilling work through price and wage settlements. Mervyn King, Governor of the Bank of England has already warned: "If this occurs, it would be expensive to bring down inflation.

Interest rates would increase, potentially crippling recovery based on a loose monetary policy offsetting expenditure cuts and tax increases.Most economists expect interest rates to remain low at least until the second half of next year, and many believe that the Bank will restart quantitative easing with an additional $ 50 billion ￡.

"The increase in [...] long-term inflation expectations."could well reflect actual inflation data, although UK inflation above target and well above forecasts [Bank]," said Mr. Saunders.

To date, however, it is little evidence that higher inflation expectations are becoming intégrées.La most pay transactions worth between 2pc, 3pc and these last months, lower than the rate of inflation, according to a study of income Data Services published today.

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