WASHINGTON (BLOOMBERG) – Inflation expectations among United States consumers rose to a new high of 6 per cent for the coming year, according to the latest consumer survey of the Federal Reserve Bank of New York, after prices surged the most in decades in the country.<\/p>\n
The survey also showed that the inflation outlook for three years declined for the first time since June, to 4 per cent, driven by respondents without a college degree.<\/p>\n
However, the level of uncertainty about consumer price outcomes rose at both the short-term and long-term horizons, reaching fresh records in each case.<\/p>\n
The results underscore the unpredictability of the recent surge that took the US central bank and most economists by surprise in recent weeks. The Fed will probably announce a faster pace of tapering at its meeting next week.<\/p>\n
Consumers are less sanguine on the economy, the survey also shows. The mean probability that the US\u00a0unemployment rate will be higher one year from now increased by 0.6 percentage point.<\/p>\n
And perceptions about households’ current financial situations compared to a year ago deteriorated last month, with more respondents reporting being financially worse off.<\/p>\n
The survey showed that Americans foresee faster price increases over the coming year for items like rent and food, which take up a big chunk of household spending and cannot easily be substituted. Expectations for gains in rent, food, college, medical care and fuel prices were all above 9 per cent.<\/p>\n
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