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The Federal Reserve may take note of whether businesses anticipate having to pay higher wages or raise prices under the next administration.
Consumers’ price expectations influence how they save and spend their money, potentially creating self-fulfilling prophecies.
The New York Fed is scheduled to report on consumer inflation expectations Monday morning, producer prices Tuesday and the consumer price index on Wednesday.
Consumers forecast inflation at 3.3% this time next year and are less confident that their earnings will rise as much as they had expected.
Households expect inflation to be 3% in a year. While that’s not up from the previous month, it’s also not down.
Consumers forecast inflation at 3% a year from now, the lowest their short-term expectations have been in three years.
But they expect other key measures to be less positive. Here’s what that means for the Fed.
Even though sentiment has tanked, a New York Fed survey finds that consumers expect inflation to ease in the future.
The consumer price index rose 5.4% year over year, as consumers’ inflation expectations hit a series high of 5.3%, the New York Fed said.
