The public’s expectations of where U.S. inflation will be a year from now surged to its highest level in nearly a decade, new data from the Federal Reserve Bank of New York said Monday.
Expected inflation a year from now surged to 4.8% in June, the highest level in a survey that dates back to 2013, from a projected 4% the previous month, the New York Fed said in its latest Survey of Consumer Expectations. The bank said expected inflation three years from now held steady at 3.6%.
Although the year-ahead expected inflation level hit a record, the bank found in its survey some softening in what the public projects for price pressures on key items. Expected food price rises a year from now ebbed to 7.1% in June from 8% in May, while gasoline prices are seen up by 9.2% a year from now, from 9.8% the prior month.
The report found mixed views on the state of personal finances. “Perceptions about households’ current financial situations compared to a year ago deteriorated, with more respondents reporting to be worse off compared to a year ago,” the report said. “In contrast, respondents were slightly more optimistic about their households’ financial situations in the year ahead.”
The report found households expecting higher levels of income, at a 3% increase a year from now in June, from 2.8% in May. Meanwhile, expected spending a year from now rose to a series high of 5.2%.