In a survey published this Friday by the University of Michigan, it was determined that American consumers’ expectations for the inflation rate for next year fell to 3.1% in September.
According to the analysis, these data represent “one of the lowest since March 2021 and just above the 2.3-3.0% range seen in the two years prior to the pandemic.” In August of this year the figure was 3.5%.
For Ian Shepherdson, chief economist at Pantheon Macroeconomics, “the drop in five- to ten-year inflation expectations is a very welcome development. We have argued for some time that a clear reduction in inflation expectations was necessaryand this decrease is a big step towards normalization,” he said.
These data are contrasted with the latest reports published by the Department of Labor when it reported that inflation in the United States increased at an annual rate of 3.7% in August, partly driven by gasoline prices.
The consumer price index rose 0.6% last month, according to the Bureau of Labor Statistics (BLS). Although the University of Michigan survey shows that Consumer confidence is strengthening due to growing optimism about inflation.
However, it is not the only analysis presented this month, the Federal Reserve Bank of New York also conducted a survey in which the result was that the American average still anticipates that next year the inflation rate will increase by 3.6% and which will remain high during the following years.
In this sense, Shepherdson highlighted that this analysis is just an advance reading “it could be revised upwards in the final reading as people respond to higher gasoline prices. But for now everything is looking good,” she said.
Although Economists predict that inflation, despite its recent small rise, will continue to decline, This is a good sign for the Federal Reserve, which since last year has implemented monetary policies such as raising interest rates to control inflation. If American consumers remain accustomed to high prices, this could complicate the task of the Federal Reserve. Fed.
The United States is currently experiencing a period of strikes and stoppages because workers in large industries are demanding higher salary adjustments and better working conditions, precisely to confront high prices, but if salaries increase, many companies will be forced to increase the costs, this in part could prevent inflation from stabilizing and reaching the Fed’s target of 2%.
Source: La Opinion