A survey by the New York Federal Reserve released on Monday shows that American households expect the recent spike in inflation won’t go away anytime soon, despite the Biden administration’s continued insistence that the surge in consumer prices will be fleeting.
The median expectation for the inflation rate over the next year increased to 5.2 percent in August, the New York Fed’s Survey of Consumer Expectations found. That level is the highest median expected inflation rate recorded since surveys began in 2013. Respondents also said they expected inflation to be up by 4 percent in three years.
“Inflation uncertainty – or the uncertainty expressed regarding future inflation outcomes – increased at both the short- and medium-term horizons to new series highs,” the survey stated.
The Biden administration has insisted that rising inflation, driven in part by supply-chain disruptions amid the coronavirus pandemic, would be temporary. Fed chairman Jerome Powell made a similar assessment in August.
“Inflation at these levels is, of course, a cause for concern,” Powell said at the time. “But that concern is tempered by a number of factors that suggest that these elevated readings are likely to prove temporary.”