US Inflation Likely to Continue Rising Despite Recent Drop in Consumer Prices - NY Fed

NEW YORK (Sputnik) - US inflationary pressure is expected to continue rising in the coming year despite a recent drop in consumer prices, the New York Federal Reserve said in a survey published on Monday.

“Median one- and three-year-ahead inflation expectations increased to 5.9 percent and 3.1 percent from 5.4 percent and 2.9 percent, respectively,” the NY Fed said in its so-called Survey Of Consumer Expectations.

The projection comes after the Consumer Price Index, or CPI, expanded at its slowest pace in  nine months in October. The CPI expanded by 7.7% over a 12-month period last month, versus a growth of 7.9% forecast by economists and against the previous yearly growth of 8.2% to September.

The NY Fed also said that US unemployment expectations have reached their highest level since April 2020 with almost 43% of Americans believing that the jobless rate will increase by next year.

“Mean unemployment expectations — or the mean probability that the US unemployment rate will be higher one year from now — increased to its highest reading since April 2020 of 42.9 percent,” the NY Fed said in its so-called Survey Of Consumer Expectations.

US employers added 261,000 jobs in October, almost 35% above economists’ expectations, according to a Labor Department report earlier this month that kept the Fed on its toes in its fight against inflation.