LONDON, June 1 Reuters British businesses expect to raise both output prices and wages at a slower pace over the coming year than they did a month ago, according to a Bank of England survey released on Thursday which may ease policymakers39; fears that high inflation will persist.

Companies surveyed in May intended to raise prices by 5.1 over the coming year, down from 5.9 in April39;s survey, the lowest since Russia39;s invasion of Ukraine in February 2022 and well below the rise of 7.6 recorded over the past 12 months.

Businesses planned to raise wages by 5.2 over the coming year, down from expectations of 5.4 in April and the lowest since July 2022.

BoE policymaker Catherine Mann said on Wednesday that Britain had a worse inflation problem than the United States or the euro zone, amid signs that high headline inflation may have created a persistent upward shift in underlying price and wagesetting patterns.

Before the COVID19 pandemic, businesses surveyed by the BoE typically reported plans to raise prices and wages by around 23 a year, close to the BoE39;s 2 inflation target.

The BoE has said it will raise interest rates above their current 4.5 level if inflation looks persistent, and since the release of higherthanexpected April inflation data last week, markets have bet that rates will peak at 5.5 later this year.

The BoE39;s Decision Maker Panel survey of 2,348 businesses took place between May 5 and May 19, before the latest inflation numbers which showed…