Home Business New York Fed survey: US consumer inflation expectations hit a new high | Reserve Bank | Federal Reserve | Inflation Rate

New York Fed survey: US consumer inflation expectations hit a new high | Reserve Bank | Federal Reserve | Inflation Rate

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[EpochTimesNovember92021](Epoch Times reporter Gao Shan compiled a report) The Federal Reserve of New York (Federal Reserve of New York) announced on Monday (November 8) that consumers’ short-term inflation expectations are It reached a record high in October.

According to a report in Washington’s “Capitol Hill” (The Hill), according to the October Consumer Inflation Expectation Survey conducted by the Federal Reserve Bank of New York, household heads surveyed expect the median consumer price index to rise by 5.7% next year. Since September last year, the one-year inflation rate expected by consumers has risen by 0.4%, reaching the highest level since the survey began in 2013.

The expected median price increase rate for the next three years is also maintained at the highest record of 4.2% set last month.

Last month’s annual inflation rate as measured by the personal consumption expenditure price index was 4.4%. The Personal Consumption Expenditure Price Index is the Fed’s preferred indicator for measuring price increases. The Fed believes that the ideal annual inflation rate should be 2%. However, the bank’s recent policy is to allow the inflation rate to exceed this level to compensate for the impact of the inflation rate being below the target level for many years.

When assessing future price increases, the Fed and economists will pay close attention to consumer inflation expectations, especially long-term expectations. The steady rise in consumer inflation expectations may lead to what economists call a wage-price spiral: higher prices encourage workers to insist on higher wages, which in turn exacerbates the need to raise prices.

The inflation rate has been further above the Fed’s target range, has exceeded the expectations of many officials, and has been at a high level for most of 2021.

Federal Reserve Vice Chairman Richard Clarida said in a speech on Monday: “For me, the level of inflation so far this year has far exceeded the’moderate’ level of our 2% long-term inflation target. , I don’t think that if this happens again next year, it will be a policy success.”

He added: “As always, there are risks in any outlook forecast, but my 12 colleagues and I believe that the risks to the inflation outlook are upward.”

Even so, Clarida said that he is still confident that the supply chain chaos that led to high inflation, the shortage of goods, and the ongoing restrictions related to the epidemic will all begin to ease next year.

He said: “Relative to the long-term goal of 2%, inflation is too high most of the time and will eventually prove to be short-lived. But as I pointed out before, there is no doubt that a complete reopening The time it takes for a $20 trillion economy is much longer than the time it takes to shut it down.”

Editor in charge: Ye Ziwei#


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