A rebound in corporate profit margins over the next year could prevent inflation falling as quickly as the Bank of England is expecting. That’s not the conclusion of a leftist thinktank or trade union. It’s a clear message from the central bank itself, or more precisely from a group of its in-house economists, whose published research examines how a wide spectrum of businesses plan to cope over the next few months and into 2024.
The data is stark. According to the research, 45% of companies surveyed say they plan to increase their profit margins in the coming 12 months. Almost a third (32%) expect “no material change” to margins and only 23% expect to suffer a fall.
