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Americans expect inflation to remain relatively steady over the next five years, according to a report released Monday by the Federal Reserve Bank of New York.
The monthly Survey of Consumer Expectations showed the median 1- and 5-year inflation outlooks were unchanged at 3% and 2.8%, respectively, from July to August.
But those surveyed said they expected inflation to be 2.5% three years from now, up from 2.3% in July.
Median home prices are also expected to increase by 3.1%, up from 3%.
The biggest anticipated price hike involved medical care, which is expected to cost 8% more in a year, up a 0.8 percentage point.
Rent costs are expected to surge 7.3%, up a 0.2 percentage point, and the price of gas is expected to creep up 3.6%, up a 0.1 percentage point.
The survey also showed that Americans felt it was easier to get credit than it was a year ago but that the portion worried about missing a payment rose to 13.6%, up a 0.3 percentage point.
The increase marked the third in as many months and pushed the reading to its highest level since April 2020, shortly after the start of the COVID-19 pandemic.
The Federal Reserve seeks to keep inflation at a rate that averages 2% over time while also maximizing employment.
The latest report from the Bureau of Labor Statistics showed the Consumer Price Index rose 2.9% over the 12 months that ended July 31.
But with last week’s monthly jobs report falling short of expectations, the Fed is widely expected to cut the benchmark interest rate when its Federal Open Markets Committee meets next week.
The current rate is in the 5.25% to 5.5% range and experts anticipate it will be either a 0.25 or 0.50 percentage point.
