Americans are still very concerned about inflation as the latest August Consumer Expectation (SCE) report suggests US consumers are expecting inflation at 5.2% a year from now on. The SCE response data hasn’t been this high since 2013, and it has increased since the previous month when U.S. residents expected 4.9% at the time.
Consumer inflation expectations continue to rise month after month
The cost of services and goods in the United States has risen sharply, and Americans are concerned about rising inflation. Citizens have good reason to be concerned about inflation, as the US Federal Reserve has fueled an extreme expansion of the money supply since February 2020.
While there have been many protests in American history after the Fed bailed out the megabanks more than once, this time the Fed was excused for at least a year. The Federal Reserve, of course, used the coronavirus (Covid-19) outbreak as the main reason the quantitative easing tactic took off so big.
This time the entire American economy had to be saved, and after about a year the central bank leaders began to be beset by complaints of inflation. The outlook on the New York Federal Reserve’s Consumer Expectations (SCE) report has worsened since May compared to the previous month.
In July, the SCE report hit an all-time high (ATH) for America’s inflation expectations. Essentially, the New York Fed uses a rotating panel of about 1,300 American households to compile the SCE data. After July, the following month’s SCE metrics were even worse as the results indicated that concerns about the loss of purchasing power were mounting.
NY Fed: “Inflation expectations rose to new series highs”
That concern has not subsided, and the latest SCE report shows that American households are still concerned and expect higher inflation.
“The consumer expectations survey of August 2021 shows that short- and medium-term inflation expectations have risen to new series highs of 5.2 percent and 4.0 percent, respectively,” said the New York Fed’s SCE report. “The expectations for growth in home prices weakened further in August, but remain elevated.”
Central bank statistics now show that respondents envision one-year inflation rising to 5.2% and expecting around 4% for three years. Not only did the one-year metric go up, but the three-year data was only 3.7% in the last SCE report.
All monthly reports said that an ATH was exceeded, and that’s because SCE readings only go back to 2013. The August SCE results show both one-year and three-year consumer inflation expectations tapped into yet another set of ATHs.
What do you think of the New York Fed’s latest SCE report, which shows inflation expectations much higher than ever before? Let us know what you think on this matter in the comments below.
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