https://sputnikglobe.com/20220912/us-consumers-inflation-expectations-at-two-year-low-as-fuel-prices-fall---ny-fed-1100694035.html
US Consumers' Inflation Expectations at Two-Year Low as Fuel Prices Fall - NY Fed
US Consumers' Inflation Expectations at Two-Year Low as Fuel Prices Fall - NY Fed
Sputnik International
NEW YORK (Sputnik) - US consumers’ inflation expectations are at their lowest in almost two years after fuel prices fell more than 30% from June’s record... 12.09.2022, Sputnik International
2022-09-12T17:44+0000
2022-09-12T17:44+0000
2022-09-12T17:44+0000
economy
us
inflation
recession
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“Inflation expectations continued to decline across all horizons,” the New York Fed said in its August consumer expectations survey. “Expectations about year-ahead price increases for gas also continued to decline, with households now expecting gas prices to be roughly unchanged a year from now.”US consumers’ 3-year inflation forecasts declined to 2.8% in August from 3.2% in July, the lowest level in almost two years, notes from the survey showed. It came as pump prices for gasoline, America’s main automobile fuel, fell from a peak of $5.01 per gallon in mid-June to average at $3.71.The New York Fed said in its report on the survey that home price growth expectations fell sharply. “Consumers were more optimistic about their future household income and financial situations.”But it also said expectations of future credit access deteriorated as fears of rising interest rates grew.The Fed has raised rates by 225 basis points in four increases since March, with two back-to-back 75 basis point hikes in June and July, to curb runaway inflation.US prices have been growing at around four-decade highs since late last year, although the closely watched Consumer Price Index, or CPI, slowed to an annualized rate of 8.5% in July from a peak of 9.1% in June. The next CPI reading, for August, is due on Sept. 13.The Fed’s target for inflation is a mere 2% a year and it has vowed to raise interest rates as much as necessary to achieve that.Economists have cautioned that the Fed could end up pushing the United States into a deep recession with its sharpest rate hikes in four decades, saying the high-flying housing sector and one-time ebullient stock market could be major victims.Preliminary estimates show the US gross domestic product, or GDP, likely contracted by 0.6% in the second quarter after a 1.6% slowdown in the first quarter. Two straight quarters of GDP growth typically places an economy in a recession.
https://sputnikglobe.com/20220825/us-remains-in-recession-despite-latest-report-showing-reduced-gdp-decline-in-second-quarter-1100000404.html
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US Consumers' Inflation Expectations at Two-Year Low as Fuel Prices Fall - NY Fed
NEW YORK (Sputnik) - US consumers’ inflation expectations are at their lowest in almost two years after fuel prices fell more than 30% from June’s record highs, but a robust job market also makes it hard for the Federal Reserve to ease off on interest rate hikes, the New York division of the central bank said.
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Inflation expectations continued to decline across all horizons,” the New York Fed said in its August consumer expectations survey.
“Expectations about year-ahead price increases for gas also continued to decline, with households now expecting gas prices to be roughly unchanged a year from now.”US consumers’ 3-year inflation forecasts declined to 2.8% in August from 3.2% in July, the lowest level in almost two years, notes from the survey showed. It came as pump prices for gasoline, America’s main automobile fuel, fell from a peak of $5.01 per gallon in mid-June to average at $3.71.
The New York Fed said in its report on the survey that home price growth expectations fell sharply. “Consumers were more optimistic about their future household income and financial situations.”
25 August 2022, 18:05 GMT
But it also said expectations of future credit access deteriorated as fears of rising interest rates grew.
“The mean perceived probability that the average interest rate on saving[s] accounts will be higher in 12 months was unchanged in August,” the New York Fed said. Higher payouts on deposits can only be made if interest rates rise across the board, and that’s an anathema for businesses.
The Fed has raised rates by 225 basis points in four increases since March, with two back-to-back 75 basis point hikes in June and July, to curb runaway inflation.
US prices have been growing at around four-decade highs since late last year, although the closely watched Consumer Price Index, or CPI, slowed to an annualized rate of 8.5% in July from a peak of 9.1% in June. The next CPI reading, for August, is due on Sept. 13.
The Fed’s target for inflation is a mere 2% a year and it has vowed to raise interest rates as much as necessary to achieve that.
Economists have cautioned that the Fed could end up
pushing the United States into a deep recession with its sharpest rate hikes in four decades, saying the high-flying housing sector and one-time ebullient stock market could be major victims.
Preliminary estimates show the US gross domestic product, or GDP, likely contracted by 0.6% in the second quarter after a 1.6% slowdown in the first quarter. Two straight quarters of GDP growth typically places an economy in a recession.