Perceptions and Expectations of Inflation by U.S. Households

Sandor Axelrod, David E. Lebow and Ekaterina V. Peneva
Additional contact information
David E. Lebow: https://www.federalreserve.gov/econres/david-e-lebow.htm
Ekaterina V. Peneva: https://www.federalreserve.gov/econres/ekaterina-peneva.htm

No 2018-073, Finance and Economics Discussion Series from Board of Governors of the Federal Reserve System (U.S.)

Abstract: To better understand inflation expectations, we examine newly available data on U.S. households' inflation perceptions-what people think inflation has been in the past. The overarching summary is that inflation perceptions look similar to inflation expectations. The central tendencies of the responses for perceived inflation over the past five to ten years are similar to those of expected inflation for the next five to ten years, and all are a little above official estimates of inflation. Thus, survey respondents overall do not expect long-term inflation to change in the future relative to the recent past. Moreover, individuals who perceive higher inflation in the past tend to expect higher inflation in the future; people whose perceptions change tend to revise their expectations in the same direction; and perceptions and expectations vary similarly by gender and income. These results suggest that if inflation perceptions were to change, they could lead inflation e xpectations to change as well.

Keywords: Consumer surveys; Inflation dynamics; Inflation expectations; Inflation perceptions (search for similar items in EconPapers)
JEL-codes: D84 E31 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2018-10-25
New Economics Papers: this item is included in nep-mac and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
https://www.federalreserve.gov/econres/feds/files/2018073pap.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:fip:fedgfe:2018-73

DOI: 10.17016/FEDS.2018.073

Access Statistics for this paper

More papers in Finance and Economics Discussion Series from Board of Governors of the Federal Reserve System (U.S.) Contact information at EDIRC.
Bibliographic data for series maintained by Ryan Wolfslayer ; Keisha Fournillier ().