US households expect 4.6% inflation over the next year. The Cleveland Fed's model says 2.6%
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The story behind it
American households now expect prices to rise 4.6% over the next year Read the edition →On the calendar
The US releases that move markets, in New Zealand and Australian time. Economic calendar →
The story behind it
American households now expect prices to rise 4.6% over the next year Read the edition →On the calendar
The US releases that move markets, in New Zealand and Australian time. Economic calendar →What the chart shows
A month ago, American households told the University of Michigan they expected prices to rise 4.0% over the coming year. In September the answer was 4.6%, level with June.
The survey answer has been above the Cleveland Fed's model estimate of the same thing in every month on this chart, and this month the model says 2.6%. The gap matters to rate-setters: people who expect higher prices tend to push for higher pay, and businesses expecting higher costs raise prices early.
Saturday's Sharespective argues that another reading like this one would make it much harder for the Fed to stop raising rates.
The numbers
Inflation expected over the next year, in percent, each month for five years: what US households tell the Michigan survey, and the Cleveland Fed's model estimate.
| Households, Michigan survey | Cleveland Fed model estimate | |
|---|---|---|
| Oct 2021 | 4.8% | 1.9% |
| Nov 2021 | 4.9% | 2.5% |
| Dec 2021 | 4.8% | 2.6% |
| Jan 2022 | 4.9% | 2.2% |
| Feb 2022 | 4.9% | 2.6% |
| Mar 2022 | 5.4% | 3.1% |
| Apr 2022 | 5.4% | 3.4% |
| May 2022 | 5.3% | 3.6% |
| Jun 2022 | 5.3% | 4.2% |
| Jul 2022 | 5.2% | 3.3% |
| Aug 2022 | 4.8% | 3.4% |
| Sep 2022 | 4.7% | 4.2% |
| Oct 2022 | 5.0% | 2.9% |
| Nov 2022 | 5.0% | 3.2% |
| Dec 2022 | 4.3% | 2.9% |
| Jan 2023 | 3.9% | 2.7% |
| Feb 2023 | 4.2% | 2.6% |
| Mar 2023 | 3.6% | 2.1% |
| Apr 2023 | 4.7% | 2.7% |
| May 2023 | 4.2% | 2.7% |
| Jun 2023 | 3.3% | 1.4% |
| Jul 2023 | 3.4% | 2.5% |
| Aug 2023 | 3.5% | 2.6% |
| Sep 2023 | 3.2% | 2.8% |
| Oct 2023 | 4.2% | 2.8% |
| Nov 2023 | 4.5% | 2.8% |
| Dec 2023 | 3.1% | 3.1% |
| Jan 2024 | 2.9% | 2.4% |
| Feb 2024 | 3.0% | 2.4% |
| Mar 2024 | 2.9% | 2.1% |
| Apr 2024 | 3.2% | 2.7% |
| May 2024 | 3.3% | 2.9% |
| Jun 2024 | 3.0% | 2.7% |
| Jul 2024 | 2.9% | 2.6% |
| Aug 2024 | 2.8% | 2.3% |
| Sep 2024 | 2.7% | 2.2% |
| Oct 2024 | 2.7% | 2.3% |
| Nov 2024 | 2.6% | 2.4% |
| Dec 2024 | 2.8% | 2.7% |
| Jan 2025 | 3.3% | 2.6% |
| Feb 2025 | 4.3% | 2.7% |
| Mar 2025 | 5.0% | 2.2% |
| Apr 2025 | 6.5% | 2.9% |
| May 2025 | 6.6% | 2.7% |
| Jun 2025 | 5.0% | 2.4% |
| Jul 2025 | 4.5% | 2.8% |
| Aug 2025 | 4.8% | 2.7% |
| Sep 2025 | 4.7% | 2.8% |
| Oct 2025 | 4.6% | 2.7% |
| Nov 2025 | 4.5% | 2.7% |
| Dec 2025 | 4.2% | 3.2% |
| Jan 2026 | 4.0% | 2.6% |
| Feb 2026 | 3.4% | 2.6% |
| Mar 2026 | 3.8% | 2.3% |
| Apr 2026 | 4.7% | 3.3% |
| May 2026 | 4.8% | 3.5% |
| Jun 2026 | 4.6% | 3.0% |
| Jul 2026 | 4.2% | 2.4% |
| Aug 2026 | 4.0% | 2.4% |
| Sep 2026 | 4.6% | 2.6% |
60 rows: scroll the table for the rest.
How we make these charts: one chart a day from a story in the edition, drawn from the figures the story names and checked against the sources named on the chart before it is published. General information only, not financial advice.
