The United States is experiencing its highest inflation rate since the early 1980s. And it looks like he’s going to stick with them for a while. Economic agents’ inflation expectations were rising and had reached their highest level since 2013.
An increase in spending for all
US consumers are raising their inflation expectations. According to a survey by the New York branch of the Federal Reserve (US Federal Reserve Bank), it came in at 6.6 percent in March. This is the highest since February 2013, when it was six percent.
Household spending is rising by 7.7 percent due to inflation, according to the survey. Only 23 per cent of households expect their financial situation to improve in the next 12 months. That’s the smallest share ever since the New York branch of the Fed has been doing such a survey.
Change household thinking?
According to experts, March inflation in the US will reach 8.4 percent, which would be half a percentage point higher than in February. The Federal Reserve therefore proceeded in March to raise its base rate for the first time in the last tech years. But convincing US households and businesses not to count on permanently elevated inflation will be a difficult task for the Fed. Increased inflation is clearly strongly rooted in expectations.
