Medium-Term Consumer Expectations Hold at 3.6% in Fed Survey
(Bloomberg) -- U.S. consumer inflation uncertainty remained elevated in June, according to a Federal Reserve Bank of New York survey released Monday.
Consumers in June said they expected inflation to increase 3.6% over the next three years, unchanged from a month earlier. Still, the top quarter of respondents expected prices to climb 7% while the bottom quarter saw them rising 1.3%. That’s the largest gap in the New York Fed’s survey dating back to June 2013.
Expected inflation over the coming year rose to a series-high of 4.8% in June from 4% the month before, New York Fed data showed. At the end of 2020, the median year-ahead expected inflation rate was 3%.
Economists in a Bloomberg survey, published on July 9, projected more modest increases in inflation. Prices are forecast to rise an average 3.7% this year and 2.7% in 2022.
Data from the New York Fed survey suggested consumers expected inflation in the year ahead to rise across a variety of categories.
“The median one-year ahead expected change in the cost of college education increased to 7.0% from 6.1% in May, its highest reading since April 2019,” the New York Fed said in a statement.
The median one-year-ahead expected change in the price of food fell one percentage point, the New York Fed said. The readings for rent held close to a record 9.7%, the survey showed.
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