© Reuters. FILE PHOTO. Federal Reserve Chairman Jerome H. Powell testifies before a House Financial Services hearing on the “Semi-Annual Federal Reserve Monetary Policy Report” on Capitol Hill in Washington,
Por Michael S. Derby
NEW YORK, March 13 (Reuters) – Near-term expectations for future inflation in the US economy fell last month to levels last seen nearly two years ago, the Federal Reserve Bank of New York said on Monday.
In its latest Survey on Consumer Expectations, the entity pointed out that, in February, those polled anticipated that inflation within a year would stand at 4.2%, a notable drop from 5% in January. The one-year forward reading was the lowest since the 4% seen in May 2021.
For its part, the level of inflation forecast for three years from now remained stable at 2.7%, equaling the last level observed in October 2020, while for five years from now it amounted to 2.6%, compared to the 2.5% January.
The survey comes on the eve of the Fed’s next monetary policy meeting on March 21-22, and until the weekend the meeting was expected to lead to an interest rate hike as the Fed moves forward. with its effort to cool the high levels of inflation.
However, the failure of Silicon Valley Bank, which forced government authorities to offer new liquidity aid to the banking system, altered the outlook for monetary policy and caused some analysts, such as Goldman Sachs (NYSE:), to be against to a rate hike at the next Fed meeting.
To further complicate the outlook for monetary policy, the government is scheduled to report on the consumer price situation for February on Tuesday. Elevated data could again put pressure on the Fed to raise rates again.
The New York Fed report was made before the SVB situation and does not reflect its impact.
The report found softer price expectations in several key components. In the past month, households have seen easing price pressures on gasoline, food, rent, health care and college. The report also notes that the public has a more optimistic view of the labor market, as well as a better view of domestic finances.
According to the report, households forecast a 1.4% increase in house prices, compared to 1.1% in January. However, the bank noted that last month’s reading is still well below the 12-month average, which forecasts a 3.4% rise in house prices.
(Edited in Spanish by Carlos Serrano)
