US consumers' short-term inflation expectations rise

The U.S. Federal Reserve (Fed) New York Branch announced that American consumers’ short-term inflation expectations increased from 4.2 percent in March to 4.7 percent. The New York Fed has published the results of its Survey of Consumer Expectations for March. According to the results of the survey conducted with the participation of approximately 1,300 households, the short-term median inflation expectation covering the next 12 months increased by 0.5 points to 4.7 percent in March. Thus, there was an increase in consumers’ inflation expectations for the first time since October 2022. Medium-term inflation expectations covering the next 3 years also increased by 0.1 points to 2.8 percent in March. During the same period, long-term inflation expectations covering the next 5 years decreased by 0.1 points to 2.5 percent. Expectations regarding an increase in household spending increased from 5.6 percent to 5.7 percent in March. Expectations for the increase in household income also increased by 0.1 percentage points to 3.3 percent in March. The expected increase in housing prices increased by 0.4 points to 1.8 percent during this period. Expectations for increases in food, energy, healthcare and rental costs decreased during the same period. According to data released last month in the US, the Consumer Price Index (CPI) increased by 0.4 percent monthly and 6 percent annually in February, in line with market expectations. Market expectations for March inflation, which will be announced on Wednesday, are for a monthly increase of 0.2 percent and an annual increase of 5.2 percent.